Second time on the block
The second time is the charm for Macau Legend Development, which asserts that a second attempt to sell its Landmark Hotel in Macau is close to being complete.
According to the Macau Business Daily, the company expects a deposit of HK$300 million (US$38.4 million) and a balance of HK$160 million (US$20.4 million) in the next month. A filing in the previous sale said the property was worth HK$5.47 billion ($700 million) at the end of 2015. A full sale price in the current transaction was not specified.
The sale was announced July 5 and will include the hotel, a casino, and dining and conference facilities, casino and car parks. Macau Legend said it will follow the sale by “consolidating resources in Macau and continuing the successful redevelopment of Macau Fisherman’s Wharf.”
With an influx of cash, the company will “have capital ready to deploy outside of Macau without taking on too much leverage”—including a HK$2.15 billion integrated resort project in Praia, the capital of Cape Verde in Africa.
“We believe that through the internally generated cash from our business and the sale of the Landmark we’ll have more than ample proceeds to execute on what we’re building in Cape Verde,” a company representative said. This will allow the group to connect better “into the West coast of Africa, where there’s a huge number of people,” along with Portuguese-speaking countries and China.
The company is also part of a joint venture signed in July 2016 that gives it 55 percent of the Troia Casino in Portugal’s Setubal region.
Linking the group’s worldwide operations is “how we get customers moving around,” the representative told the Business Daily, adding “we look at Portugal to Cape Verde as we look at Macau to Laos. There’s a lot of connectivity.”
MLD has also entered into a development agreement with the Laos government to purchase and operate the troubled Savan Resorts in Savannakhet Province. “Obviously the Laos government was happy to get someone of our quality—in terms of an operator, track record, connections into China—to come in and take over that asset,” the representative said.
“I think there’s a good role for us as that mid-tier,” said the representative. Speaking of David Chow, MLD’s co-chairman, executive director and CEO, he added, “He is not going to build multibillion-dollar assets. We’re not competing with the big international operators. And in fact our space at the mid-level, there’s not a lot of guys like us—that build US$200-400 million assets. And I think we’re pretty good at that, we don’t take a lot of risks.”
He added that the company may join the race to win an integrated resort license in Japan. “One of our largest shareholders is Dynam, which is the second largest pachinko company in Japan,” Chien said. “So I think to the extent that Dynam is successful in doing something in Japan and they invite us in, of course we’d have a look.”
