Initial public offerings in Hong Kong since September have been up an average 27% unlike in the US where nearly half of IPOs have fallen below their offer prices. Last week it was reported that Sands China was expected to raise around US$3.4 billion in its Hong Kong IPO but in fact on Saturday the company offered the shares at the bottom end of the price range to raise US$2.5 billion. The new money plus a further finance facility should enable Sands to restart the stalled Cotai Strip developments.

It appears that investors were focused on the future potential of the projects, which after completion in 2012/13 should provide some 6,000 hotel rooms and 300,000 sq ft of gaming floor as well as retail and other facilities. The venues will be directed towards the mass market in the belief that growth in Asian disposable incomes will bring growth to the Macau economy through rising visitor numbers from mainland China and beyond.

Sands China, a subsidiary of Las Vegas Sands, says its ultimate plans for Cotai include five interconnected integrated resorts, which leverage a wide range of branded hotel and resort offerings to attract different segments of the market. When complete its Cotai Strip development is expected to contain over 20,000 hotel rooms, approximately 1.6 million square feet of MICE space, over 2.0 million square feet of retail malls, six theatres and other amenities. (E-11.23.09)

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