Melco unit shoring up capital

MANILA, Philippines - The local unit of Macau-based casino giant Melco Crown Entertainment Ltd. is shoring up the capitalization of a subsidiary that holds a Philippine gaming license.

In a regulatory filing, Melco Crown (Philippines) Resorts Corp. said its board of directors approved the purchase of 40 million common shares of MCE Holdings (Philippines) Corp. worth P9.5 billion.

MCE Holdings is the parent firm of MCE Leisure (Philippines) Corp., a partner of SM Investments Corp., Belle Corp. and Premium Leisure Amusement Inc. in the gaming license at the 120-hectare Entertainment City.

The companies hold a provisional license from the Philippine Amusement and Gaming Corp (Pagcor), allowing them to build an integrated casino and hotel.

Fresh capital will allow MCE Holdings to bankroll the construction of the $1.3-billion Belle Grande casino project in the Pagcor complex.

In April, Melco Philippines raised $377 million after selling 1.09 billion shares at P14 apiece, the high end of the P11-14 price range, to fund the casino’s construction.

Last week, Melco Philippines president and chairman Clarence Chung said the company is on track to starting commercial operations of Belle Grande Manila in the middle of 2014.

The megacasino operator is banking on Chinese high rollers to prop up the country’s gaming revenues.

Melco Philippines is the operator of the 950-room Belle Grande Manila casino and resort complex being built by Belle, the upscale leisure developer of mall and banking conglomerate SMIC.

Belle Grande Manila will be the second casino to operate in Entertainment City following the $1.2-billion Solaire Resort and Casino of port magnate Enrique Razon that opened in March.

Belle Grande Manila, which will have 240 gaming tables and 1,250 machines, will be Melco Crown’s first casino outside Macau where it operates the City of Dreams and Altira Macau casinos.  – Neil Jerome Morales

The government is grooming Pagcor’s 120-hectare Entertainment City along Manila Bay as a competitor of the Las Vegas, Singapore and Macau gaming hubs.

Pagcor forecasts that gambling revenues in the Philippines will grow to $2.5 billion by end-2012 from $1.3 billion in 2011. It expects gaming revenues to hit at least $10 billion by 2017 coming from the operations of the four gaming licensees in Entertainment City.