Melco to Have Better Chances for Japanese Integrated Resort

Melco Entertainment has recently announced a deal with Crown Resorts. After a while, this could be a good move for Melcoˈs further plans to acquire the Japan integrated resort.

Predictions

According to a GGRAsia study, four brokerage companies shared positive thoughts on the investment in the Crown Resort project. With this successful movement, Melco will have favorable chances to purchase the Japan Integrated resort (IR).

On this occasion, Sanford C. Bernstein Ltd published:

“While Melco will utilize some debt capacity to fund it share purchase, we do not see this as an impediment in Melco’s Japan bid. In fact, owning an Australian operation may help enhance Melco’s standing in the bid process.”

At the same time, Nomura Instinet LLC shared that the firm will be a “more attractive option” for IR license. Roth Capital Partners agreed:

“We view Melco’s transition toward a fully international entertainment resort company as helpful to its stock multiple and beneficial for its competitive bid for a casino concession in Japan.”

Other Opinions

The Macquarie Group didn't specify anything about the Japanese market, but it expects inclusion of other Crown Resorts suitors. The Group has been looking for the purchaser since CEO, James Packer, started facing health problems.

Some firms don't see the end of Melcoˈs plans. According to Bernstein, the company could be looking to buy the rest of Crown Resorts. They stated:

“This may occur through several transactions over time following regulatory approvals. We would hope to see a full acquisition of Crown (at the right price) in the future to limit the complexity of Melco (something that has historically plagued the company).”

We expect to see further steps. At the moment, the company holds two casinos in Macau and Manila, with ongoing projects in the UK and Australia. Melco could soon become a holder of a Japanese license.

About the Brand

A successful developer and casino operator in Asia, Melco currently operates City of Dreams Macau resort, Altira Macau (water-based facility), a luxury hotel and Mocha Clubs non-casino based electronic machines. Another casino facility is located in Manila and has been in operation since 2014. The City of Dreams of Manila allows complete entertainment combined with shopping, spa and restaurant experience.

Source:

“Melco a better candidate for Japanese IR after Crown Resorts deal“, Derek Tonin, calvinayre.com, May 31, 2019.