he funds raised will help finance expansion, Kazuo Okada, Universal Entertainment chairman, said in Macau yesterday. “We plan to list in Hong Kong after opening” the first phase of the Manila project in 2012, he said, declining to provide an estimate of the size of the offering.
Universal Entertainment is expanding outside Japan as successive governments have ignored industry calls to legalize casinos in the world’s second-largest economy and as the popularity of pachinko declines. Asian investors are becoming more informed about the casino gaming industry, said independent industry strategy consultant Jonathan Galaviz. “The tourism sector of Asia will continue to be a robust growth sector,” Galaviz said. “The Philippines can be a part of that if it plays its cards right.”
Universal Entertainment gained the most in a week, rising 7.7 % in Tokyo trading. The shares have gained 34 % this year. The company owns 19.9 % of Wynn Resorts, billionaire Stephen Wynn’s casino operator.
Universal Entertainment aims to lure high-limit gamblers - so-called VIP players - from China to the Manila resort, Okada said. Macau gambling revenue surged 57 % in the first quarter to about us$ 5.1 billion as Chinese economic growth accelerated to the fastest in almost three years.
The Manila project, which will be built on a 40-hectare site, may cost between us$ 2.7 billion and us$ 2.8 billion, and construction may begin this month, Okada said in an interview translated by adviser Michiaki Tanaka.
Piling work on the Manila casino resort will begin this month after the Philippines government waived the corporate tax on non-gambling businesses for the initial four years and offered a “lower-than-usual” rate from the fifth year onward, Okada said. The first phase of the resort will include a casino, a hotel and an aquarium. The completed project will include two casinos, two hotels and a residential building and may be finished within five years, he said.
The Philippines is luring companies to build casino resorts by offering lower taxes, in a bid to boost tourism. Philippine tycoon Andrew Tan and Genting Hong Kong Ltd. opened their us$ 700 million Resorts World Manila development last August. Genting Hong Kong was named Star Cruises Ltd. at the time of the opening.
“Our gaming tax is lower than Macau and slightly higher than Las Vegas,” said Rafael Francisco, President of Philippine Amusement and Gaming Corp. Licensed casinos pay 25 % for gaming tax, along with a corporate income tax for entertainment and other non-gaming income, he said. “It is critical that the Philippines invest heavily in its Manila tourism infrastructure to ensure that the Manila Bay corridor is viable in the long run,” Galaviz said.