The latest National Revenue Report on the casino market in the US, published by Fantini Research, suggests that there is a glimmer of hope for an industry beset by a slowing economy, smoking bans and high fuel prices. Casino revenues fell 1.38% in June to US$2.225 billion but show signs of stabilising. However, prospects for new casino developments in the US and elsewhere are now more risky propositions.
In the Philippines the global credit crunch has caused Crown Ltd to pull out of a project in Manila Bay. According to CEO Rowen Craigie at the moment it is very difficult for gaming operators to develop commercially viable casino-entertainment projects when significant external debt funding is required. Crown is no longer pursuing an investment with Bloombury Investments Ltd or in any other proposal for the area.
In June Crown wrote off the $44 million it had contributed to the deposit to buy a site on the Las Vegas strip with American partners. The company then cited a lack of credit for its decision to halt plans to build a $5.2 billion casino complex. Crown is still considered a buyer as it has cash from the demerger of Publishing and Broadcasting Ltd, and it has been rumoured to be looking at casinos in the US as well as watching developments in countries such as Japan, Vietnam and Taiwan.
Las Vegas Sands yesterday announced it will no longer pursue a gaming licence in Kansas. William Weidner, president of Las Vegas Sands Corp, thanked people there for their support but said the decision was made in the best interests of the company’s employees and shareholders. He also cited changes in the present financial market place as a reason the decision to pull out of the Kansas project was taken.
“It now appears that proposed statutory changes in Missouri will allow gaming operators there to significantly increase the amounts being wagered at their competing facilities. This change, together with the increased borrowing costs in today's financial marketplace, significantly decreases the expected returns from our proposed development in Kansas and limits our ability to generate appropriate risk-adjusted returns on the proposed investment vis-ŕ-vis our expected returns on our other global investment opportunities." (E-07.23.08)
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