By Edwin Chan and Gina Keating
LOS ANGELES, Oct 12 (Reuters) - The shares of U.S. casino operators from Las Vegas Sands Corp to Wynn Resorts Ltd slid on Monday after the Chinese city of Macau said it might curtail their expansion into the world's fastest-growing major gambling center.
The former Portuguese enclave of Macau is considering rules, to be drafted in two to three months, that might impose limits on table numbers and raise age limits for casinos, according to a statement posted on the city's official Web site. www.gov.mo
Wynn, Sands and rival MGM Mirage have invested billions in the past to establish and expand operations in the only Chinese city where gambling is legal, hoping to ride double-digit percentage growth in visitors -- particularly from mainland China -- and gaming revenue.
But critics say breakneck casino expansion has fomented a host of social ills from corruption to prostitution, while Beijing, worried about addiction, periodically tries to stifle the flow of its tourists.
In a statement on Monday, Macau Secretary for the Economy and Finance Tam Pak Yuen said all six major casino operators -- which it did not name -- agreed broadly during a meeting that casino expansion should not be limitless.
'The casino operators have agreed that the scale of the industry should be examined,' the statement read. 'The government pledges that we will listen to public and industry feedback before objectively examining the issues.'
Macau's six casino operators include Sands and Wynn Resorts Ltd, along with home-grown players Galaxy Entertainment Group Ltd and SJM Holdings Ltd . The other two are Melco Crown Entertainment Ltd -- a joint venture between Melco International Development Ltd and Australia's Crown Ltd -- and a casino jointly operated by MGM Mirage.
Spokesmen for Las Vegas Sands had no immediate comment on the government's statement. Wynn declined comment. A spokesman for the Macau government and MGM could not be reached.
RIDING THE CREST
Las Vegas Sands shares slid as much as 8 percent before ending down 1.8 percent at $17.72. Wynn Resorts stock lost as much as 5.6 percent before finishing off 2.9 percent at $65.88, while Wynn Macau shares closed down 0.2 percent in Hong Kong. MGM Mirage, which has a joint venture in Macau, closed 1.6 percent lower at $12.08.
Major U.S. gambling operators have benefited from a surge in visitors to the former Portuguese island just an hour's ferry ride from southern China and Hong Kong.
Underscoring investor interest, Wynn Macau enjoyed a strong debut last week on the Hong Kong Stock Exchange via a $1.63 billion share sale, ending 6 percent higher. The gain boded well for the Las Vegas Sands' own proposed listing later this year.
Macau rocketed onto the global gambling stage following reforms that put an end to a monopoly and awarded licenses to many players that boosted competition.
Macau generated HK$105.6 billion ($13.5 billion) in gross gaming revenues in 2008, more than double the HK$46.7 billion generated by the Las Vegas Strip during the same period, according to a prospectus from Wynn Macau.
Among regulations now under discussion, the government is considering raising the entry age for casinos to 21 years old from 18 and dictating that slot machine halls move away from residential areas and into commercial zones.
In the statement, the government also reaffirmed it was requesting that operators hire mostly locals to staff their establishments, which it said the companies agreed to do.
The news comes as Beijing continues to waffle on allowing its country's citizens to travel freely to Macau.
China quietly began easing restrictions on its citizens traveling from Guangdong province to Macau earlier this year, top executives at two of Macau's six casino licensees told Reuters in September.
The government became alarmed that Guangdong residents were gambling too much on the neighboring island and imposed rules last year limiting them to two trips a year.
That clampdown was also prompted by reports of officials gambling away millions of dollars in government funds.
But the authorities began easing the rule as early as three months ago, allowing gamblers from Guangdong to travel to Macau once a month, the executive said in September.
(Reporting by Edwin Chan and Gina Keating, with additional reporting by Karen Jacobs in Atlanta; editing by Andre Grenon) Keywords: MACAU/ (eddie.chan@thomsonreuters.com +1 213 955 6750; eddie.chan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
LOS ANGELES, Oct 12 (Reuters) - The shares of U.S. casino operators from Las Vegas Sands Corp to Wynn Resorts Ltd slid on Monday after the Chinese city of Macau said it might curtail their expansion into the world's fastest-growing major gambling center.
The former Portuguese enclave of Macau is considering rules, to be drafted in two to three months, that might impose limits on table numbers and raise age limits for casinos, according to a statement posted on the city's official Web site. www.gov.mo
Wynn, Sands and rival MGM Mirage have invested billions in the past to establish and expand operations in the only Chinese city where gambling is legal, hoping to ride double-digit percentage growth in visitors -- particularly from mainland China -- and gaming revenue.
But critics say breakneck casino expansion has fomented a host of social ills from corruption to prostitution, while Beijing, worried about addiction, periodically tries to stifle the flow of its tourists.
In a statement on Monday, Macau Secretary for the Economy and Finance Tam Pak Yuen said all six major casino operators -- which it did not name -- agreed broadly during a meeting that casino expansion should not be limitless.
'The casino operators have agreed that the scale of the industry should be examined,' the statement read. 'The government pledges that we will listen to public and industry feedback before objectively examining the issues.'
Macau's six casino operators include Sands and Wynn Resorts Ltd, along with home-grown players Galaxy Entertainment Group Ltd and SJM Holdings Ltd . The other two are Melco Crown Entertainment Ltd -- a joint venture between Melco International Development Ltd and Australia's Crown Ltd -- and a casino jointly operated by MGM Mirage.
Spokesmen for Las Vegas Sands had no immediate comment on the government's statement. Wynn declined comment. A spokesman for the Macau government and MGM could not be reached.
RIDING THE CREST
Las Vegas Sands shares slid as much as 8 percent before ending down 1.8 percent at $17.72. Wynn Resorts stock lost as much as 5.6 percent before finishing off 2.9 percent at $65.88, while Wynn Macau shares closed down 0.2 percent in Hong Kong. MGM Mirage, which has a joint venture in Macau, closed 1.6 percent lower at $12.08.
Major U.S. gambling operators have benefited from a surge in visitors to the former Portuguese island just an hour's ferry ride from southern China and Hong Kong.
Underscoring investor interest, Wynn Macau enjoyed a strong debut last week on the Hong Kong Stock Exchange via a $1.63 billion share sale, ending 6 percent higher. The gain boded well for the Las Vegas Sands' own proposed listing later this year.
Macau rocketed onto the global gambling stage following reforms that put an end to a monopoly and awarded licenses to many players that boosted competition.
Macau generated HK$105.6 billion ($13.5 billion) in gross gaming revenues in 2008, more than double the HK$46.7 billion generated by the Las Vegas Strip during the same period, according to a prospectus from Wynn Macau.
Among regulations now under discussion, the government is considering raising the entry age for casinos to 21 years old from 18 and dictating that slot machine halls move away from residential areas and into commercial zones.
In the statement, the government also reaffirmed it was requesting that operators hire mostly locals to staff their establishments, which it said the companies agreed to do.
The news comes as Beijing continues to waffle on allowing its country's citizens to travel freely to Macau.
China quietly began easing restrictions on its citizens traveling from Guangdong province to Macau earlier this year, top executives at two of Macau's six casino licensees told Reuters in September.
The government became alarmed that Guangdong residents were gambling too much on the neighboring island and imposed rules last year limiting them to two trips a year.
That clampdown was also prompted by reports of officials gambling away millions of dollars in government funds.
But the authorities began easing the rule as early as three months ago, allowing gamblers from Guangdong to travel to Macau once a month, the executive said in September.
(Reporting by Edwin Chan and Gina Keating, with additional reporting by Karen Jacobs in Atlanta; editing by Andre Grenon) Keywords: MACAU/ (eddie.chan@thomsonreuters.com +1 213 955 6750; eddie.chan.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
© 2009 AFX News
