THE M3: ANOTHER LVS SUIT; MACAU PACKAGE TOUR DATA

The Macau Metro Monitor, March 14, 2012

 

 

LAS VEGAS SANDS FACES $375 MILLION SUIT BY FORMER MACAU PARTNER NY Times

A filing submitted to a court in Macau in January by Asian American Entertainment, an estranged former partner of LVS controlled by the Taiwanese businessman Shi Sheng Hao, who also goes by the name Marshall Hao, alleges LVS of improperly breaking off a 2001 agreement to bid for a Macau casino license and seeks compensation of 3 billion patacas, or more than US$375MM.  

 

In October 2001, LVS signed a letter of intent to team up with Asian American in bidding for a casino license.  Hao had recruited financial support from China Development Industrial Bank, a Taiwanese lender that had agreed to underwrite the joint bid.  Asian American submitted a formal offer to the government of Macau in December 2001 on behalf of itself and Venetian Venture Development, a subsidiary of LVS.

 

Asian American’s suit alleges that Venetian Venture Development violated the terms of their bidding agreement in early 2002 by going behind its back to seek a rival bidding partner.  When results of the tender process were announced by the government on Feb. 8 of that year, LVS had won — not in partnership with Asian American, but with Galaxy of Hong Kong.

 

Asian American had previously filed a breach of contract suit against Sands in 2007 in US federal court in Nevada, but that case was dismissed by the court in 2010.  In that 2007 suit, LVS had argued that Nevada had no jurisdiction over the case and that Asian American’s claims were void because of the statute of limitations. But on appeal, a higher court allowed some of Asian American’s claims to go ahead, sending the matter back to the lower court in 2009. The matter was ultimately thrown out by the lower court after Asian American failed to retain lawyers to press the case — effectively giving up.

 

It is unclear why the company has chosen to take up the case again now, in Macau.  Under Macau’s laws, LVS has two months to respond to Asian American’s suit.  Based on the timing of most civil cases, the matter would be unlikely to go to trial before 2013.

 

MACAU PACKAGE TOURS AND HOTEL OCCUPANCY RATE FOR JANUARY 2012

Visitor arrivals in package tours surged by 43.6% YoY to 634,993 in January 2012, attributable to the Lunar New Year holidays.  Visitors from Mainland China (424,234) increased by 34.1%, with 176,498 from Guangdong Province.  Moreover, visitors from Taiwan (60,273); Hong Kong (41,877); and the Republic of Korea (34,428) soared by 151.5%, 139.0% and 43.2% respectively YoY.  The average length of stay increased by 0.02 night to 1.5 nights.