Macau’s government has announced that international gambling operators can now submit bids for new licenses from July 29th to September 14th.
Macau’s existing casinos have no guarantee that their licenses will be renewed
The licenses of the six incumbent gambling operators — Galaxy Entertainment, MGM China, Melco Resorts, Sands China, SJM Holdings, and Wynn Macau — are set to expire at the end of 2022 with no automatic renewals. This means that all six must now compete with international companies looking to gain a foothold in the world’s most lucrative gambling market.
The rebidding process will take place following the recent covid outbreak that saw casinos close their doors for 12 days straight. While the casinos are now reopened for business, tourism numbers have plummeted while the local market is restarting extremely slowly. Analysts have stated that casinos can expect to have little to no income for the next few months.
According to the government’s announcement, all bidders provide a guarantee of 10 million patacas ($1.24/€ million). The announcement also notes:
“special consideration should be given to develop foreign tourist markets, experience in operating casino games, investment in gaming and non gaming projects for Macau’s benefit, plans to manage the casino, plans to monitor and prevent illegal activities and social responsibilities.”
A special committee vet bidders with decisions on all licenses expected in the fourth quarter of 2022. Any existing companies that fail to renew their license must exit the market by the end of the year with no exceptions.
A note from Morgan Stanley released prior to the recent round of closures stated that casino operator debt in Macau has risen from US$5 billion (€4.6 billion) in 2019 to US$20 billion (€18.6 billion) in 2021 and could reach US$27 billion (€25.2 billion) by the end of 2023.
An experienced iGaming commentator and analyst based in New York City - Jenny reports on regulation and gambling industry news and events.