HKS: Emperor Int'l & Emperor Entertainment

Emperor may acquire two Hotel Lisboa VIP rooms

Mark Lee

Saturday, January 21, 2006

Emperor Entertainment Hotel, a property developer with casino interests in Macau, said it may buy two VIP rooms in the Hotel Lisboa from controlling shareholder Albert Yeung as part of a move by the tycoon to focus his gaming assets in one listed entity.
"In the long term, Emperor Entertainment Hotel is aiming to become the gaming flagship of the whole [Emperor] group," said Emperor spokeswoman Sidney Luk. "We are considering plans for the VIP room assets to be injected into [Emperor Entertainment Hotel], but the main difficulty is to come up with a valuation for those assets, as there is currently no benchmark."

Emperor Entertainment Hotel operates one VIP room in its 45 percent- owned Grand Emperor hotel-casino, which formally opened Friday following a soft launch at the start of January. It has leased seven other VIP rooms in the hotel to other operators.

Emperor Entertainment Hotel managing director Vanessa Fan said the newly opened VIP room will generate more gaming revenue than the two VIP rooms owned by Yeung.

"The new VIP room is much bigger and has a much more comfortable setting, and consequently, higher revenue potential," Fan said, though she declined to provide any forecasts.

The hotel, in which Stanley Ho's Sociedade de Jogos de Macau owns 20 percent, also has 328 slot machines and 65 public gaming tables.

Apart from the new hotel-casino, which cost about HK$1.5 billion, the company owns Golden Princess, a casino-cruise ship acquired for US$17 million (HK$132.6 million) last year. Emperor Entertainment Hotel collects HK$9 million a month in rents for leasing the cruise ship to a casino operator and is entitled to 30 percent of the gross gaming revenues. The company derived all its HK$67.6 million turnover in the six months ended September 30 from income from the cruise ship.

Golden Resorts, another Hong Kong-listed operator of hotel-casinos in Macau, said last year that one of its shareholders, Lee Shiu-fok, is planning to inject six VIP rooms into the company. Lee is chief executive of Lisboa Gold Group, which operates the VIP rooms in Hotel Lisboa. The VIP rooms generated 12.2 billion patacas (HK$11.8 billion) in gross revenues over the past three years.

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