Gambling shares rocket
Shares in Malaysia’s Genting Bhd. rose dramatically today after being granted a casino licence by the Singapore government on Friday, as reported by Jackpot.co.uk.
Shares rose by approximately 12 percent on the Kuala Lumpur Stock Exchange, whilst Genting International closed up 24 percent at 52 Singapore cents. Genting’s affiliate cruise operator, Star Cruises, also enjoyed a favourable increase, seeing shares up by nearly 24 percent on the Singapore Stock Exchange.
Genting announced today that they will fund two-thirds of their £1.7 billion casino project by bank loans, with the remainder being provided through equity. Genting International will provide 75 percent and Star Cruises the remaining 25 percent of the equity.
"We are very keen to get cracking on this project and financing is the first step. I am confident that we will be able to secure financing this year even though there are a few days left," Genting Chairman Lim Kok Thay told reporters.
Although talks have already begun to find a financer, Genting have refused to confirm any details. However, Barclays Bank, DBS Bank, HSBC, OCBC Bank and Royal Bank of Scotland are reported to be involved in preliminary discussions.
Lim also said that the group was assessing its current debt level after the casino win and its recent purchase of Stanley Leisure PLC, the U.K casino operator.
Moody’s analyst Kaven Tsang said that although the new casino project would raise Genting’s exposure to development and execution risks, as well as capital needs in the medium term, it would also strengthen the company’s regional and competitive position.
"Moody's believes that the increased risk profile is manageable in view of Genting's track record," Tsang said, believing that the outlook for Genting was stable.
It is expected that the casino on the 49-hectare site on Sentosa Island will open in early 2010, with Lim targeting a recoup of investment seven years after opening.
Genting follow Las Vegas Sands as the only casino operators in Singapore, after the U.S gambling giant was granted their casino licence earlier this year in May.
Editor, Jackpot.co.uk - 2006-12-11 11:22:27