4 minute read
AUSTRALIA
Star and partners bet on China tourism
Star Entertainment Group has expanded its strategic partnership with Hong Kong-based Chow Tai Fook and Far East Consortium as the companies bet on growing Chinese tourism to Australia.
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Under the accord, the Australian company will raise A$490 million (US$375.2 million) from the sale of shares. Both Chow Tai Fook and Far East Consortium will each receive 45.8 million new shares at $5.35 per share, and have their shareholdings capped at 19.9 percent. There will be no change to The Star’s board.
The strategic partnership will see both parties jointly pursue and participate in growth projects in, or adjacent to The Star’s current properties. It will also see the establishment of a marketing alliance to drive high value tourism to The Star’s properties.
“The board welcomes Chow Tai Fook and Far East Consortium as shareholders in The Star. Our expanded strategic partnershiprecognizes the strength of our relationships built over the last four years and the shared vision of investing in properties with valuable long-term licenses in sought after destinations,” Star Chairman John O’Neill said.
David Chiu, chairman of FEC said: “Strengthening the partnership with The Star and Chow Tai Fook further leverages our considerable complementary capabilities and helps to maximize the long-term value of The Star’s properties in Sydney and South-East Queensland.
The three companies are working together to redevelop a site at the Queen’s Wharf in Central Brisbane.
Expected to open in 2022, the $3 billion Queen’s Wharf Brisbane aims to transform the Central Business District and the river’s edge. The project is expected to employ 8,000 people once it’s fully operational.
The group is counting heavily on tourism arrivals from Asia to drive demand.
VIP gaming revenue at both Star Entertainment and rival Crown Resorts dropped sharply after China’s crackdown on corruption and the detention on the Chinese Mainland of Crown employees on gambling-related offences.
However, more recent figures have shown the VIPs are coming back and Star Entertainment is confident the new development and Queensland’s natural attractions will help draw in the crowds.
“It will be Australia’s best integrated resort, a world-class destination competitive with anything on offer in the Asia Pacific region, to attract domestic and international visitors who will contribute substantially to the Queensland economy,” O’Neill said at the ground-breaking ceremony in March.
“With our Hong Kong partners, Chow Tai Fook Enterprises and Far East Consortium, we are very confident in the tourism outlook for southeast Queensland,” he said.
“Together, we have projects and plans in Brisbane and on the Gold Coast which represent nearly a third of the total $14 billion of Queensland tourism infrastructure projects in the pipeline between now and 2022.”
The number of Chinese visitors to Australia is expected to jump three fold to 3.9 million by 2026. Queensland had more than half-amillion visitors from China last year, 3.8 per cent more than 2016, and direct flights from China have recently started to Brisbane, Cairns and the Gold Coast.
For the six months ending Dec. 31st, Star recorded a 15.9 percent gain in normalized revenue. Domestic revenue was up 5.7 percent, while its international VIP rebate business jumped 47.7 percent.
There are a further two casino licenses expected to be awarded in Queensland, one on the Gold Coast and one in Cairns. Politicians recently denied there were any plans to build a casino at a site on the Sunshine Coast.
Synthetic lotteries face chop
Lottery betting, or synthetic lotteries, will be banned in Australia under new legislation that will cover both domestic and international draws.
Communications Minister Mitch Fifield said the government was of the view that synthetic lottery “undermines the longstanding community acceptance of official lottery and keno products.”
“Traditional lotteries and keno games are popular and long-standing recreational gambling products that form an important income stream for thousands of small businesses across Australia, including newsagents, pharmacies, pubs and community clubs,” he said.
“They also generate significant taxation revenue for state and territory governments, helping to fund schools, hospitals, public transport and roads.”
He warned that online gambling companies that allowed betting on lottery outcomes generated “considerable community concern.” The new legislation is set to take place six months after passing through parliament to allow for an appropriate transition period.
Packer steps down on mental health concerns
Billionaire James Packer has stepped down from the board of Crown Resorts citing mental health problems. “Mr Packer is suffering from mental health issues.
At this time he intends to step back from all commitments,” according to a statement from his private company Consolidated Press Holdings.
Crown Resorts thanked Packer for his contribution to the company in a brief statement to the Australian Stock Exchange. “We have appreciated James’ contribution to the Board and respect his decision to step down from his role as a director at this time,” Crown’s Executive Chairman, John Alexander, said.
Packer had only returned to the board last year after previously stepping down to focus on international interests.
