Genting Singapore improves chances of winning Japan casino license

The strong cash position gained by Genting Singapore with the new Japan subsidiaries could improve its chances of winning a casino license in the country.

While local governments in Osaka, Yokohama, Nagasaki and Nagoya have expressed interest, the timeline set by Japanese authorities indicates the sites probably won't be selected till 2021, with construction expected to take an additional three to four years, Nikkei Asian Review reports.

The casino business is expected to generate billions of dollars in annual revenue and has already drawn the interest of major gambling companies such as Las Vegas Sands of the U.S.

Genting Singapore, which has a separate listing in the city-state, runs Resorts World Sentosa, one of two casino resorts in Singapore. Genting, the group's flagship company, owns about 53% of the Singapore firm.

The Genting Group's other casino properties are in Malaysia, the Philippines and the UK, and the group is currently building a $7.2 billion resort in Las Vegas.

Genting Singapore said in a statement late Tuesday that its Japan units would be involved in developing and managing integrated resort and leisure destinations as well as marketing and promotion, and related activities.

"We think the prospect of running one of the first-ever integrated resort casinos in Japan would present a highly profitable opportunity for those selected," Moody's Investors Service said in a report on Wednesday.

"Japan has a dense population and Asian culture has a demonstrated high propensity to gamble. This makes the country an ideal resort casino destination, similar to what already exists in Macau, China and Singapore," the ratings agency added.

According to Moody's, Las Vegas Sands is in the strongest position to obtain a Japanese license, thanks to its positive credit profile and financial flexibility as well as its large presence in Macau and Singapore.

In Genting's case, its huge cash pile of 3 billion Singapore dollars ($2.2 billion) and experience operating in the city-state, which has similar restrictions on gaming companies, could improve its chances of winning a casino license in Japan, Malaysia's Star newspaper said.

To address concerns about gambling addiction, the new law imposes admission restrictions on Japanese nationals. These include an admission charge of 6,000 yen ($53.40) per day and a cap on entry into the casino set at three days a week and 10 days a month.

The casinos themselves must take up no more than 3% of the total resort area, another restriction similar to Singapore rules.