Wed, May 15, 2:48pm by Staff Writer
US-based gaming operator MGM Resorts International says it will submit a proposal to develop a casino resort in Osaka.
GGR Asia reports that the document submitted by MGM was done so in partnership with Japanese financial services group Orix Corp, as confirmed by MGM Resorts Japan chief executive Ed Bowers on Monday.
Osaka’s request for concept application phase is an effort to identify parties interested in being commercial partners for hosting a casino resort.
The process began on April 25 and ends on May 24.
At Monday’s event, Mr Bowers did not reveal details of the proposal, but reiterated that the consortium is anchored by, but not exclusive to, Orix as “Osaka corporations” are expected to participate in the scheme as minority partners.
Japanese newspapers had also reported that the Osaka authorities’ plan requires a US$8.5 billion investment in a casino resort, to open in 2024.
The term integrated resort or IR is used in Japan to describe large-scale gambling resorts with ancillary leisure facilities.
Under the Osaka request for concept requirements, a submission should include a number of core attributes as identified by the national government in ordinances on March 26.
They are: convention capacity; exhibition space; an attraction to promote to the world Japan and its culture; ability to function as a tourism gateway to other parts of the country; and a large-scale hotel.
Respondents to Osaka’s RFC must also outline countermeasures to gambling addiction and plans to ensure community safety.
— Osaka Informer (@osakainformer) May 13, 2019
A maximum of three casino resorts will be permitted in the first stage of market liberalization in Japan, and interested local governments will still need to get approval from the national authorities.
MGM Resorts chairman and chief executive James Murren had said earlier this year that the company expected Osaka to select “by early 2020” the private-sector partners it would like to work with when pitching to the national government for the right to host a casino resort.
MGM Resorts International joined forces with a Japanese financial services group to form a consortium and jointly bid for the right to build an integrated resort in Osaka, Casino News Daily reported in March.
MGM and financial firm ORIX have partnered up ahead of the casino license bidding process.
The Nikkei Review estimates that the licenses could be worth up to 1.75 trillion yen (US$15.9 billion) a year.
News about the move arrived shortly after the Las Vegas and hospitality powerhouse’s chief executive officer Jim Murren told Bloomberg during his trip to Japan last week that his company would focus all its attention on being selected as the preferred developer of a property in Osaka.
Japanese financial services group ORIX Group announced last Friday that it would have an equity in a consortium with MGM that would bid for one of the three gaming licenses that will be available as part of the first phase of casino gambling liberalisation in Japan.
The amount of equity the two companies will take remains unknown.
A senior research analyst at brokerage company Sanford C. Bernstein said in a weekly note to clients, “MGM would not be a controlling party of the development.”
“This is the first clear sign the casino operators have less than 50 per cent or controlling stake,” Vitaly Umansky said.
The resort, which will include a casino, hotels, restaurants, a conference centre and other entertainment facilities will be operated by the consortium while MGM will manage the casino.
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