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HomeNewsMacauSJM to acquire Ponte 16 and L’Arc casino properties, shutter seven other satellite casinos

SJM to acquire Ponte 16 and L’Arc casino properties, shutter seven other satellite casinos

Macau legacy gaming operator SJM has announced that it is going to be acquiring two casino properties in which it operates satellite casinos and will shutter seven others at the end of this year. SJM has the largest number of satellite casinos of the three operators which are engaged in satellite activities.

According to a company release, SJM’s board ‘has concluded the intention to acquire the properties where Casino L’Arc Macau and Casino Ponte 16 are located’. Despite the announced intention, the group notes that ‘the potential acquisitions have not yet commenced, and no binding agreements have been reached’.

L'Arc
L’Arc Macau

The company further announced that it plans to not continue operations at the satellite casinos located in Casa Real, Emperor Palace, Fortuna, Grandview, Kam Pek, Landmark and Legend Palace.

The group indicated that ‘regardless of the outcome of negotiations […], all gaming tables and slot machines from affected satellite casinos will be reallocated to SJM Resorts’ self-owned casinos.

The operator also assured that ‘all Macau residents currently working at the satellite casinos scheduled for closure […] will be offered job opportunities within SJM Resorts’ portfolio of properties’.

Negotiations to ensue

Under the new satellite casino legislation, gaming operations at the venues would only be allowed to continue if the casino property is owned by the operator, or if there is a management contract established with the property owner under which the owner gets a fixed fee and not a portion of gross gaming revenue.

SJM
Ponte 16

Currently the casino at Ponte 16 is operated by Success Universe, under SJM’s gaming license. Success Universe had not previously indicated that it was intending to relinquish its profit share from the operation of the casino.

The casino at L’Arc is operated under a service agreement with SJM Co-Chairman Angela Leong which encompasses ‘services and licensing for occupation and use of the designated area in the L’Arc Hotel to SJM for the operation of a casino’.

Under the law, SJM will only be required to acquire the casino space, and not the entire property in which the casino is located – similar to how Melco owns the casino space in Studio City despite not fully owning the entire property it is located in.

Regarding the properties scheduled to cease gaming operations, Kam Pek is operated under Paradise Entertainment (which halted trading on the HK Stock Exchange on Monday), Emperor Palace is operated by the Emperor Group, Landmark is linked to a Macau businessman (after being sold by Macau Legend), Legend Palace is operated by Macau Legend, while Fortuna is linked to a Macau company, while Casa Real and Grandview are under the Kingston Financial Group.

SJM informs that the board ‘does not expect the restructuring to have any material adverse effect on the Group’s operations, liquidity, or profitability’.

Kelsey Wilhelm
Kelsey Wilhelmhttps://agbrief.com
Kelsey Wilhelm is a print and broadcast journalist and editor. Based in Asia for over 20 years, he saw the birth of Macau's rampantly successful gaming industry, propelling him into the world of casinos. Now focusing on all markets throughout Asia, he embraces new technologies and trends, from sports betting to online gaming – always seeking the new frontier.

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