Genting plans rights issue in Singapore
CASINO operator Genting Singapore is raising $1.2bn (£725m) in a rights issue for possible acquisitions, leading a bout of fund-raising by casino companies in Asia taking advantage of rising stock markets.
The Singapore firm also said yesterday its Resorts World at Sentosa casino development is on track, both in terms of project costs and timing, for a “soft opening” in early 2010, debunking fears of more cost overruns at its massive project in the city-state.
Las Vegas Sands, the world’s most valuable casino firm, plans to spin off its Macau operations in a Hong Kong initial public offering to raise as much as $3bn, while Wynn Resorts is expected to list its Macau business in the fourth quarter.
“The rights issue will strengthen the company’s financials and put us in a strong position to tap strategic opportunities,” Genting Singapore managing director Justin Tan said in a statement.
But speculation remained strong that the issue was to address cost overruns at the Resorts World at Sentosa casino that it is building in the city-state, as AmResearch said in a research note issued before the company formally announced the issue.
Analysts also said the Singapore unit’s fund-raising may result in parent company Genting tapping 4bn ringgit ($1.14bn) in cash held by Genting Malaysia, which operates the group’s lucrative casino business in the Muslim country.
Genting Singapore’s cash call “could be a catalyst for Genting Bhd to accelerate the sale of its noncore assets or push Genting Malaysia to pay out its 4bn ringgit cash hoard,” JPMorgan said in a note to clients.