THE M3: SANDS TO CLOSE COTAI FINANCING; MELCO 10.5% BOND DEAL; FOREIGN WORKERS; AIRPORT/MICE

The Macau Metro Monitor, May 11th, 2010


 

SANDS CHINA TO CLOSE US$1.75 BLN FINANCING FOR COTAI PROJECT BY MONDAY WSJ, Reuters,

Sands China should close the $1.75BN financing for its Cotai expansion project no later than May 17 according to CEO of Sands China, Steve Jacobs, which will pave the way for construction to resume on the property.  Jacobs said phase one of the project, which will include 3,700 hotel rooms for the Shangri-La, Traders and Sheraton hotel brands, will open in the third quarter of 2011, representing a "three to four month" delay from the initial plan to open in June 2011.  Jacobs reiterated the project would open with 670 tables despite the Macau government's decision to cap gambling tables in the city.  He also said the company would "find a way" to eventually employ the up to 10,500 construction workers needed to complete the project despite a government proposal to require one local construction worker be employed for every worker from outside Macau brought onto a project.  Jacobs added he is sure there are now fewer than 2,000 workers in Macau available given the flurry of construction projects in the Chinese territory.

 

According to Jacobs, the company also saw a "low probability" of cost overruns at Sites 5 and 6.  In addition, Sands, which has been approached by local gaming firms in Japan, is eager to move into a market with the potential to be Asia's largest gambling market, Jacobs said.


MELCO SETS GUIDANCE AROUND 10.5% FOR DLR BONDS-SOURCE Reuters

MPEL has given price guidance of around 10.5% for its planned sale of up to $600MM of eight-year dollar bonds, according to a close to the deal.  Deutsche Bank, Bank of America Merrill Lynch, and Royal Bank of Scotland are the lead managers for the proposed bond, which will be non-callable for the first four years.  A series of meeting with investors in Singapore, Hong Kong, London, Boston and New York were held ahead of the proposed bond sale.

 

DEMOGRAPHIC STATISTICS FOR THE 1ST QUARTER 2010 DSEC

In the end of 1Q2010, the total number of non-resident workers decreased by 2,062 QoQ to 72,843.


AIRPORT HOLDING BACK MICE macaubusiness.com

The lack of adequate infrastructure, particularly an airport with extensive international connections, is the main reason Macau’s meetings business has not grown as fast as expected, says Michael Leven, president and COO of Las Vegas Sands. The city started pursuing business travelers seriously with the 2007 opening of the Venetian Macau, ''but we didn’t have enough hotel rooms to get the big functions." ''Even if we have 3,000 rooms at the Venetian, we needed more, which is what we’re building now'', Leven told The New York Times.


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