MANAGEMENT CHANGES AT CROWN?

I believe Ted Chan will be named the new Chief Executive of Crown Macau, replacing Keith Heise who may have been fired. This appointment would make sense as Amax Entertainment announced on Monday that Mr. Chan resigned to pursue another Macau opportunity.

Amax owns 80% of AMA, which is currently the sole junket aggregator for Crown Macau. The arrival of Mr. Chan would appear to be fairly seamless and confirm Crown’s position as primarily a VIP property. I’m not sure what this means for the AMA/Crown relationship. We had been hearing that it was somewhat strained already.

The management change was probably driven by what we expect was an awful Q3 at Crown, both on the volume and hold side. MPEL will announce Q3 earnings later this month and investors shouldn’t be surprised when it is not pretty.