Macau and local casino operator MGM China Holdings Limited have announced that they are in line with a recently ratified bill that would allow them to obtain one of the new 10-year gaming contracts for their former Portuguese residence.
The company behind MGM Macau, which has 600 rooms as well as the much larger MGM Kotai property, used its official filing (pdf) on Sunday to invest around $594 million in MGM Grand Paradise Limited, which detailed that the company would then be able to apply for permission to continue operating the two gambling-friendly venues until the end of 2032. The Hong Kong-listed company said in November it expects the permitting process to be completed by the government through an open tender of the nine-member Casino Game Steering Committee.
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In return, MGM China Holdings Limited explained that it will issue just over 4 million Class A shares, as well as 730,000 Class B shares of MGM Grand Paradise Limited. As part of this process, the company said it plans to transfer the latter tranche to billionaire businessman Panty Ho Chiu-King (pictured) for a Peppercorn fee and make the 59-year-old daughter of former Macau casino mogul Stanley Ho Hong-Sun the managing director of its new operating subsidiary.
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As a result, MGM China Holdings Limited said it would hold an 84.6% stake in MGM Grand Paradise Limited, while a separate 15% stake would be controlled by Ho. The company also said this interest to result in American gambling giant MGM Resorts International receiving a 0.4% interest would be in line with new legislation requiring locally licensed casino operators to have a minimum kitty of about $618 million while permanently residing in Macau and controlled by figures "holding at least 15% of the concessionary's capital."
Read the statement from MGM China Holdings Limited…
"If this tender is successfully completed, the MGM Grand Paradise Limited Board will impose additional duties and obligations upon her delegation of executive director authority. It has been conditionally agreed that she will serve as the executive director of MGM Grand Paradise Limited for the same period as the concession period, taking into account the remuneration and incentive payments set out in the service agreement concluded between Ho and MGM Grand Paradise Limited."
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