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Place your bets. Singapore's announcement that it
will build two casino resorts worth about US$3 billion combined has the city
aflutter with talk of which gaming companies will come up with the most
dazzling plans.
The 19 proposals from the world's top casino operators will be whittled down to
a shortlist ahead of the December decision on the two to develop the projects
at the city-state's downtown Marina Bay and its Sentosa resort island.
Eight of the bidders are widely seen to have the best odds to build what
American investment bank Merrill Lynch says could be the world's most expensive
casinos.
Las Vegas Sands, Wynn Resorts, MGM Mirage, Harrah's Entertainment, Kerzner
International, Eight Wonder, TabCorp and Genting have emerged as top contenders
to develop the projects.
The government's insistence that the two resorts offer wholesome family
entertainment may favor bidders that can come up with popular attractions, said
analysts.
Malaysia's Genting and partner Star Cruises have roped in Universal Studios, the
theme parks and entertainment giant.
``This certainly tips the odds in their favor,'' said Christopher Khoo, managing
director of tourism consultancy MasterConsult Services.
Analysts also said that two American gaming operators working with Singapore
state-linked bidders - Harrah's with Keppel Land and MGM with CapitaLand - also
stand a higher chance of being picked by a government keen to ensure control
over the casinos.
``The government will most likely not give away a very profitable license
without local beneficiaries,'' wrote DBS Vickers Securities analysts Timothy
Wong and Kok Ken-ji in a recent research note.
Keppel Land and Harrah's, which is vying with MGM to be the world's largest
casino operator, have secured architect Daniel Libeskind, who designed the
``Freedom Tower'' at New York's Ground Zero.
Meanwhile, 62 percent government-owned CapitaLand is working separately with MGM
and Kerzner to bid for the projects, which are expected to open in 2009.
MGM runs top Las Vegas casinos such as the Bellagio and Luxor while Kerzner
operates the world's most expensive hotel rooms at the Atlantis resort in the
Bahamas.
They are up against formidable competition from the likes of Las Vegas Sands and
industry visionary Steve Wynn.
Besides theme parks and museums, bidders are also drawing up plans for shopping
plazas, convention halls and luxury hotels to meet government regulations that
limit gaming revenues to 50 percent of turnover.
``I can't think of another gaming jurisdiction in the world with such a rule,''
said Harrah's senior vice president for business development Richard Mirman.
``The winning groups have to be creative enough to come up with other sources
of revenues, and I think the Las Vegas players have a good sense of that.''
While most Las Vegas casinos generate about half of their earnings from
gambling, Kerzner's Atlantis resort earns three-quarters of its revenues from
non-gaming sources such as its restaurants and hotel rooms.
Keen to placate concerns that the casinos will lead to higher rates of crime and
gambling addiction, each bidder's record of corporate integrity and social
responsibility will also be deciding factors, said Jonathan Galaviz, a casino
gaming and airlines consultant.
REUTERS
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