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Las
Vegas Sands Eyes Macau Big-Time
Hard times on the Las Vegas Strip
don't stop Las Vegas Sands from pursuing largest
ever loan for a Macau project.
Sheldon
Adelson is a person of vision. When the American
billionaire businessman looks ahead to the future,
and east to China, he sees a 20,000 room hotel
and casino complex. A closer look reveals 3,000
table games and 20,000 slot machines.
The
project, worth $12 billion, will most likely set
Macau as the world's biggest gambling hub for
years to come, a title it already holds since
overtaking the Las Vegas Strip in 2006.
Financing
the deal
Adelson's Las Vegas Sands (LVS) is the world's
largest casino company. To finance the project
it is reported that it may borrow $7 billion.
No deal is yet to be formally announced, but if
it goes through it will be its biggest outstanding
loan.
It
is also said that Las Vegas Sands may replace
another loan, of $3.3 billion, to finance the
Venetian casino resort project, also in Macau.
Macau
Macau is the only region in China where gambling
is legal. Analysts expect the supply of gaming
tables in Macau to increase by 20 to 30 percent
next year. This may serve as justification for
the large investment on behalf of Mr. Adelson.
Industry
analysts and executives further expect Macau to
maintain its revenue growth for an even greater
period of three years or even more.
Las
Vegas
Meanwhile in Las Vegas,Strip casino revenue fell
for the fourth straight month in April, according
to the Nevada Gaming Control Board.
Fuel
costs are only one reason for the decreased revenue,
as is the housing slump and the larger economic
recession. These factors hurt not only gambling
patterns, but conventions as well.
Joseph
Greff, an analyst at JP Morgan Securities, warned
a week ago of the "magnitude and duration"
of the Strip's problems.
LVS
market performance
Greff's comments, as in stating that "We
expect this summer to be one of the worst on record,
with meaningfully discounted room rates and special
discounted package deals," have actually
affected the Las Vegas Sands stock.
LVS
shares fell to the lowest price since January
2006 last week, including a 59% drop in 2008.
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