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Despite public commentary by management, Four Seasons apartment sales are unlikely to happen any time soon.

Once again, LVS management are out in the public domain claiming that government approval is forthcoming for the sale of Cotai apartments.  This time it came from LVS’s Macau CEO Steve Jacobs who said approval may come this year.  We’ve been hearing this at least since October 2007 when LVS made a public announcement.

This issue came up quite frequently in our discussions in Macau last week.  Based on those discussions, it became apparent that government approval for apartment sales was actually unlikely this year and was complicated recently by Sheldon Adelson, LVS Chairman and CEO.  “[Edmund Ho, former Macau CE] made a commitment to us that, if we started parcels 5 and 6 and if we did an IPO, then for sure we could sell [the Four Seasons apartment hotel as] strata condos…”  Apparently, Bank of China was backstopping the sales but after Sheldon’s comments and a quick phone call from Beijing, that no longer seems to be the case. 

Mr. Adelson has also opined on the table caps (“not a good idea”) and relaxing imported labor quotas (“the right thing to do”).  While he maintains that Lots 5/6 are on track for a Q3 opening next year, we saw little construction activity and he still needs the government to get it done.  Following our Macau visit last week, we think a 2012 opening may be more likely.

Sheldon thinks that if he makes privy conversations with the government public then the government will be forced to oblige.  When will he learn - as Steve Wynn has learned - that it is just the opposite?