MGM Has Chances for Integrated Resort Partnership

According to the recent estimations of Fitch Ratings, MGM Resorts International is one of the leading candidates for Japan Integrated Resort in Osaka. Bidding for IR is soon to start and two major contenders for the property are MGM and Orix Ltd. The position of the US-based company has been improved after two other candidates, Las Vegas Sands and Melco Resorts, decided to focus on other casino locations within Japan.

Background

MGM is one of the premium casino operators in the USA. As one of the best candidates, the company has been concentrated on an IR project for a while. Despite all obstacles, the enterprise didn’t make additional effort to become a top-rated contender. Alex Bumazhny observed:

“The exit of Las Vegas Sands and Melco [Resorts] from Osaka certainly increases the probability that the MGM/Orix consortium, which was already a strong contender, wins the RFP [request-for-proposal] there. However, a handful of other operators that have not pulled out [of Osaka] yet, such as Genting [Group] and Wynn [Resorts Ltd], also have a decent chance.”

He added:

“Our sense is that whatever ends up being built [in Osaka] will be world class and will be the maximum investment the winning operator could make before jeopardising their return on investment thresholds. None of the major public operators that are left in the race are known for underinvesting when looking at their recent portfolios, and all have solid financial profiles as well as development and operating experience.”

Other Candidates

MGM is not the only applicant for Osaka Integrated Resort. Both Galaxy Entertainment and Genting Singapore are looking to improve positions for expecting bidding process. The other candidate, Wynn Resort, is also interested in creating the “world’s largest casino property” in the city. Osaka has always been one of the potential candidates for an official casino license regarding its favorable tourism position and the entire support.

Meanwhile, the second-largest city in Japan, Yokohama, has been working hard to improve its gambling reputation. The efforts paid off as both Melco Resorts and Las Vegas Sands are interested in Yokohama location. Melco stated that Yokohama features a “convenient location, communication links, vibrancy, and pioneering spirit,” which makes it “an ideal candidate for a large-scale development designed specifically for premium international tourists.”

Source:

“MGM most likely partner for Osaka integrated resort”, Erik Gibbs, calvinayre.com, September 24, 2019.