Macau Legend Gains Operational Control of Savan Vegas Casino

The sale agreement between Macau Legend Development Ltd and the Laos government for operational control of the Savan Vegas Hotel and Entertainment Complex casino property in Laos was completed last week.

Macau Legend which is a leading casino operator in Macau has agreed to pay $42 million for the right to operate the casino complex. The agreement additionally includes a 50-year monopoly on casino operations across three provinces in the country, expansion plan approvals and guaranteed minimum tax benefits. One of these three provinces is where the casino is located.

In a statement, David Chow Kam Fai, co-chairman and chief executive of Macau Legend, said,

We sincerely thank the government of the Lao PDR for their support and trust in Macau Legend and we have a shared vision with the government on both the transformation of the existing Savan Vegas Casino and Hotel as well as development of the proposed new integrated resort by our company in Savannakhet [province]

Savan Vegas Hotel & Entertainment Complex, Laos

Macau Legend had formally announced in August that it was entering into a sale agreement with the Laos government for the control of the Savan Vegas. The closure of the agreement was expected to take place before August 31 but it took a few more days for the deal to be finalized. Souphanh Keomixay, the Minister of Planning and Investment said that this was another example of investment being made for the economic growth of the country, adding that the government was looking forward to working with the company towards transforming the province into a popular tourist destination.

The Savan Vegas property was seized by the government in 2012 after the authorities claimed that the company owed the Laos government US$23 million in back taxes and penalties. Prior to the government taking control of the casino, Sanum Investments Ltd and its parent company, Lao Holdings NV owned the casino.

Lao Holdings NV has filed three cases against the sale process of the casino complex and charged the U.S-based private equity firm Marco Capital Partners of undervaluing the assets of the company during the sale process. The Laos government gave Marco Capital interim control of the casino till the sale was completed.

The government had earlier tried to dispose the casino via a round of competitive bidding but stopped the process after shortlisting bids. It subsequently started discussions with Macau Legend for the sale agreement. Macau Legend operates two casinos in Macau – the Babylon Casino located on Macau Fisherman’s Wharf and Pharaoh’s Palace Casino located at the Landmark Macau. The casinos are operated under the aegis of SJM Holdings Ltd which is owned by Hong Kong billionaire Stanley Ho Hung Sun.

Adrian Sterne

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