This story is sponsored by Genting Casino
Malaysian casino and resorts giant Genting has increased its stake in Australian casino owner Echo Entertainment, two weeks after James Packer’s Crown disposed of its shares.
Genting, which operates online gambling in the UK under the Genting and Circus Casino brands, increased its stake from 5.2% to 6.6% following the purchase of 11.4 million shares via its Hong Kong affiliate last week.
Genting’s Singapore subsidiary unexpectedly slashed its holding in Echo in September last year, but recently applied to the New South Wales gaming authority to increase this above 10%. The regulator has however yet to issue a decision and has not indicated when it will do so.
The transaction follows two weeks after Crown disposed of its shares in Echo in order to pursue a licence for a new bricks ‘n’ mortar casino in Sydney “without speculation surrounding its Echo shareholding.”
Crown bought into Echo in 2011 as billionaire owner James Packer focused on capturing a slice of the action from the growing number of high-roller casino players from Asia who are now visiting Sydney and other cities in Australia.
While the stake was widely seen as an insurance policy, Echo is also understood to have proved resistant to Crown’s efforts to use the stake as leverage in negotiations over a mooted joint venture that would have accommodated Crown’s target demographic of wealthy international casino high-rollers visiting Sydney. The territory of Macau now generates six times the annual revenue of the Vegas strip, fuelled by wealthy Chinese gamblers.
Crown and Echo are competing to develop new casino facilities in Sydney, with both having until 21 June to submit binding proposals to the New South Wales government.
Echo is seeking to extend its Star resort’s exclusive casino licence beyond 2019, while Crown is seeking a separate licence to add a high-roller casino to its proposed six-star hotel in Bangaroo, Sydney.
Genting’s intentions regarding the stake - whether strategic or acquisitive - are unclear at this stage, and largely contingent on the decision of the NSW Gaming Authority.
The casino and resort giant - until recently the largest operator of bricks ‘n’ mortar casinos in the UK - recently called time on its two-year shirt sponsorship of English Premier League football team Aston Villa.
Article written by Katy Stirland
