THE M3: MPEL HK LISTING; LAWRENCE HO INTENTIONS; HOTEL ROOMS

11/30/11 09:02AM EST

The Macau Metro Monitor, November 30, 2011

MELCO COULD LIST 6% SHARE IN HK Macau Daily Times, Reuters

Melco International Development signed a sale and buyback agreement for part of its 33.2% stake in Melco Crown to help support the company’s planned dual listing in Hong Kong.  Melco International Development loaned a 3% stake to the listing sponsors and pledged to lend as much as a further 3% stake to support “liquidity activities”.


Melco Crown wants to complete the listing by the end of this year but it’s not planning for a global offering in view of “current market sentiment,” it said last week.  Instead of issuing new shares, Melco Crown would instead choose a listing of shares already on issue. This alternative, called listing by introduction, would raise no additional funds. “The company will continue to evaluate future fund raising plans."  Trading in its HK shares is expected to start on Dec. 7 under the listing symbol HK6883.

"We are comfortable that we can fund our equity component of the financing of Macau studio city with existing cash and cashflow," said MPEL CFO Geoffrey Davis, adding that discussions with banks were in progress for financing.  Regarding VIP concerns, "We are not seeing any changes in patterns in terms of velocity of money. Things have been pretty consistent for the last 12-18 months," Davis stated.

CEO Lawrence Ho told reporters that Melco was ready to kickstart the project and was waiting on government processes.

Ho said Melco would aim to outperform the broader industry's gaming revenue growth in the coming year.  "Growth rates of some 50-60% are not sustainable in the long run.  In 2012, I expect industry growth to be around 15-20%," he said.

LAWRENCE HO MAKES HIS INTENTIONS CLEAR WSJ

Mr. Ho does not intend to become a director of rival Macau casino operators SJM or MGM China.  Though Lawrence Ho has small effective interests in both Shun Tak and SJM, he says he doesn’t have any involvement in the companies’ management or operations.

SUPPLIES OF HOTEL ROOMS IN MACAU MIGHT SURPASS DEMAND Macau Daily News

The government announced that there are a total of 12 hotel projects under construction, supplying 10,700 hotel rooms, of which 9 projects are on the Macau peninsula, and 3 projects in Cotai, supplying 9,880 rooms.  Projects pending for approval
totaled 20, supplying 13,890 hotel rooms, where 14 projects were on the Macau peninsula, 2 on Taipa, 3 on Cotai and 1 on Coloane.  The hotel industry worries that the supply of hotel rooms will exceed the demand once the number of tourists drop, and hotels without casino support will not be able to survive the competition.

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