what will soon be one of Singapore's key attractions — Resorts World at Sentosa, the integrated resort being developed by Genting International (GIL) featuring six hotels, a Universal Studios Singapore Theme Park, a Broadway Theatre and, of course, a casino.
the integrated resort — one of two being simultaneously developed in Singapore — is scheduled to open in early 2010. By 2015, it is expected to provide some 30,000 jobs and generate as much as S$2.7 billion (about RM6.3 billion) or about 0.8% of Singapore's annual GDP.
GIL ups the ante
Last week, GIL announced that it had injected a further S$400 million into its Resorts World at Sentosa unit, raising its equity to S$1.5 billion. With rising construction costs in Singapore, GIL's original budget of S$5.2 billion for the entire project has already swelled to $6 billion. Assuming that GIL plans to fund one-third of the project with equity and the rest with debt, it will probably have to inject S$500 million more into Resorts World at Sentosa, according to analysts.
GIL raised about S$2.1 billion in net proceeds from a rights issue at 60 cents per share last year and another S$875 million from the issue of convertible bonds. In February, the company also secured about S$4 billion in credit facilities for the development of the integrated resort.
Stanley Leisure — now called Genting Stanley — owns 46 casinos across the UK, including four in London. To finance the acquisition, the group took out a bridging loan of £390 million (about RM2.4 billion), adding to its debt. As at the end of last year, GIL had S$775.1 million in long-term loans and S$370.5 million in short-term loans on its books.
earlier this month, the company announced that it had received an online gaming licence from the Alderney Gambling Control Commission, the gaming regulator in Alderney, which is part of the British Channel Islands. The licence will still be subject to certain regulatory approvals, but GIL expects business to commence in 2Q.
For FY2007, GIL reported a net loss of S$381.5 million, its first loss after six straight years of profitability. The decline was primarily due to an impairment loss of S$454.6 million on goodwill arising from its acquisition of Genting Stanley. According to a recent report by CIMB's Tan dated Feb 25, the new gambling tax structure in the UK reduced Genting Stanley's earnings by £6 million.
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