Riding high on confidence
Genting Group is a global casino group based in Malaysia. It was founded in 1965 and it has a presence in North America, Australia, Malaysia, Singapore, the UK and Malaysia.
It is looking at increasing its presence in Asia, particularly in the Japanese market, where three resort casino licenses will soon be open for bidding. Genting Group chairman Lim Kok Thay spoke of his confidence in a resort casino license. He said: “We are positive about our efforts in getting a casino license in Japan.”
Subsidiary Genting Singapore will be making the bid.
According to a recent report from Maybank Kim Eng, a research company, Genting appears to have a very good chance of winning a license. This is especially due to Genting Singapore has a large net cash reserve, which is a massive plus.
Genting currently owns one of the two resort casinos in Singapore, so it has experience operating a resort casino in the region.
Also battling to obtain a license is MGM Resorts International.
Legislating the resort casinos in Japan
Debate raged for many years in Japan about whether or not to make commercial casinos legal. They finally got the green light in 2016.
Two years later, in 2018, resort casinos also became legal. This measure only got passage at the very close of that year’s legislative session. It allows for the issuance of three resort casino licenses.
The bidding process for the three licenses has yet to begin. The first step will be to select three cities or regions that will each get a license. It will then be up to those destinations to choose their operating partner for the casino.
New regulations for these resort casinos got the go-ahead on March 26 from Prime Minister Shinzo Abe’s administration. It looks like the first of them will be open by 2024.
Operating the casinos
Most of the major global casino companies are showing an interest in obtaining one of the licenses. When it becomes time for development, billions of dollars worth of investment will go into these projects.
The three resort casinos will create many jobs both during the development process and when they finally opens their doors. They will be aiming to rival Macau as a premier destination for gambling and tourism in the continent. A large influx of tourists will come to these locations from across Asia and the globe, pumping money into the local economies.
The size of the casino can only be up to 3% of the total size of the resort. There must also be a large convention and exhibition center on the site. Any players making a transaction of ¥1m ($9,000) or more in cash will require the casino to send a report to the government.
Advertising the resort casinos is already curtailed. The casinos will only be able to advertise in cruise ship terminals and international airports. This is to quell concerns in the country that the legalization of casinos will lead to a significant increase in the number of problem gamblers.
MGM Resorts and Osaka
Osaka seems to be the most likely city to obtain one of the three resort casino licenses. It is hosting the World Expo in 2025 and it is a major destination for tourists. Most industry experts believe that Osaka is at the top of the list for one of the licenses.
MGM Resorts International is already banking on Osaka getting a license. It has set up offices in the city in order to be well positioned when it is time to choose an operator. The company believes Oska will select its operator in early 2020. That is, if the city gets the license.
MGM’s current CEO spoke of the company’s plans in a recent full-earnings report. He said: “We just recently opened up an office in Osaka. We’ve committed now to the mayor and to the governor of Osaka. MGM has adopted an Osaka-first strategy. We are focusing our considerable resources on Osaka.”
MGM Resorts already has a presence in Asia, with a casino in Macau called the MGM China. The company is looking to further expand in the region.
To help with this process, the company has brought the former governor of Nevada, Brian Sandoval, on board. He will be heading up the company’s expansion efforts in Japan. He has a lot of experience when it comes to dealing with casinos and politicians.