Big Investor Drops Sands China

A major U.S. fund manager has sold its $1 billion-plus stake in Sands China in favor of an equivalent investment in parent company Las Vegas Sands. Waddell & Reed Financial, which once held more than 6 percent of the Macau operator, said it considers LVS a more liquid bet.

U.S.-based asset manager Waddell & Reed Financial has sold off its stake in Sands China and moved the money into the Macau operator’s parent, Las Vegas Sands Corp.

The firm sold 192.64 million of Sands China’s Hong Kong-traded shares, a 2.4 percent stake, at HK$55.45 (US$7.15) a share, generating US$1.38 billion, according to a term sheet cited by The Wall Street Journal.

The firm established a similar position in NYSE-listed Las Vegas Sands by buying 17 million shares, saying it was swapping stakes due to the “greater market liquidity in shares of Las Vegas Sands compared to Sands China”.

Waddell & Reed has been selling its Sands China holding over the past few years. In May 2011, it sold 114 million shares, decreasing its holding to 4.78 percent from 6.21 percent. It sold shares after that as well.

The firm added after that last placement that it continues to have a “positive view on the investment outlook of Las Vegas Sands and its ability to generate revenue in China and elsewhere around the world”.

Sands China (HKSE: 1928) has risen more than 40 percent over the last 12 months as investors expect the casino operator will continue to benefit from the spending of wealthy gamblers from mainland China and elsewhere.