Eighth Wonder Submits Singapore Casino License Bid

11.10.2006, Lesen Sie hier den Bericht über «Eighth Wonder Submits Singapore Casino License Bid»

Eighth Wonder, which developed the New York New York resort in Las Vegas, submitted its bid to build and run Singapore's second casino, the last license the city- state's government will issue for at least a decade. The Las Vegas-based company, Kerzner International Ltd. and Genting Bhd. may each propose investments of as much as $2.9 billion by today's bidding deadline, Merrill Lynch & Co. said in a report yesterday. The city's government has said it will announce the winner by the end of the year.

Singapore lifted its ban on casinos last year in a bid to double overseas visitor arrivals to 17 million and triple tourism spending to S$30 billion ($19 billion) by 2015. Eighth Wonder, Kuala Lumpur-based Genting and Bahamas-based Kerzner are competing for 2.5 billion potential Asian customers who live within a five-hour flight of the city- state. ``The winning bidder will be the one that offers the Singapore government the lowest execution risk through the key stages of design, construction and operation,'' Sean Monaghan, an analyst at Merrill Lynch in Singapore, said in the report.

The government in May awarded Las Vegas Sands Corp. a contract to develop a casino in the city-state's downtown area. The world's biggest casino-operator by market value has committed to investing more than $3 billion. Both gaming resorts are expected to open by 2010. Macau Competition

In the past three years, Singapore's government has attempted to shed off the city's straight-laced image, allowing attractions such as the Crazy Horse Paris topless revue and reverse bungee jumping. The second casino, to be built on the island of Sentosa, may include attractions such as a Universal Studios theme park and designs by architects such as Frank O. Gehry, designer of the Guggenheim Museum in Bilboa, Spain.

Asia is attracting more interest from overseas gambling companies as the world's most populous continent increases its wealth. When its casinos open, Singapore will be competing to win more tourists from Macau, which opened its gambling market to overseas investors for the first time in 2002. Macau is poised to overtake the Las Vegas strip as the world's largest gaming hub in revenue. Casino operators such as Las Vegas Sands and Wynn Resort Ltd. are betting on China's 1.3 billion population and rising income level to fuel tourist growth in the former Portuguese colony.

Eighth Wonder Eighth Wonder predicts its $1 billion resort alone would draw 10 million visitors each year, exceeding the 9.4 million tourists Singapore expects for the country in 2006. The company has hired Rudolph Giuliani, mayor of New York during the Sept. 11 attacks, to plan the security features of its bid and remain as an adviser for at least 10 years should it win.

James Packer, chairman of Publishing & Broadcasting Ltd., and Chris Anderson, deputy chairman, today accompanied Eighth Wonder Chairman Mark Advent to the bid submission room. Genting is having its second attempt at winning a Singapore license. Asia's largest gaming-operator by market value, which is making a joint bid with Star Cruises Ltd., said it will commit more than $1 billion to a Universal Studios theme park that will be larger than the Los Angeles location should it win. The company, which last week said it gained control of the biggest casino-operator in the U.K., said Michael Graves, architect of the World Bank's International Finance Corp.'s headquarters in Washington D.C. and one of the Walt Disney Co.'s hotels at the company's Paris theme park, will design the Sentosa resort.

Genting Bid Genting expects a successful bid may help it surpass MGM Mirage and Wynn Resorts Ltd. as the world's third-biggest casino company. The company said Oct. 6 that it owns or has received bid commitments for 69.4 percent of Stanley Leisure Plc stock after an offer that it says values the largest U.K. casino operator at 639 million pounds ($1.2 billion).

The operator of Malaysian casino-resorts in the mountain-top destination called Genting Highlands has been ranked by brokerages such as Merrill Lynch and CIMB-GK Research Pte as having the best chance of winning. ``The investment they have put into Genting Highlands over the years have arguably made Malaysia a more attractive destination, and has given Malaysian an additional tourist destination,'' said Edward Ong, senior analyst at Macquarie Securities in Malaysia. ``They can do the same thing in Singapore if given the chance.''

Kerzner, Harrah's Kerzner, owner of the Atlantis gaming resort in the Bahamas, named Gehry, designer of the Guggenheim Museum in Bilboa, Spain, to design the Singapore project. The architect was called a ``brand name'' by analysts such as DTZ Debenham Tie Leung's Ong Choon Fah. The company's video presentation for the project includes an endorsement of Chairman Sol Kerzner by South Africa's first democratic leader, Nelson Mandela. Kerzner has said it would spend more than $1.5 billion on the Singapore resort.

Harrah's Entertainment Inc., the world's biggest casino- operator by sales, pulled out of the bidding process on Oct. 6. The Las Vegas-based company said last week it received a $15.1 billion takeover offer from Apollo Management and Texas Pacific Group.

MGM Mirage, the other bidder for the first license, didn't bid for the second. Tourists are spending fewer days in Singapore, with stays averaging three days from four in 1991, Prime Minister Lee Hsien Loong has said. Tourists are staying an average of four days in Hong Kong, five in London and almost a week in New York.

Singapore will impose a S$100 daily levy on the city-state's citizens and permanent residents entering its casinos, as well as other controls such as regular law- enforcement reviews of the gaming resorts to curb problem gambling, money laundering and other vices. The resort ``must be a world renowned development that will cement Singapore's reputation as a must-see destination and the facility must be able to remain competitive in the long-term,'' Merrill Lynch's Monaghan said. To contact the reporter on this story: Linus Chua in Singapore at lchua@bloomberg.net .

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