Spurred by news of MGM China‘s acquisition of a 7.2-hectare plot of land in the Cotai district in Macau, the Chinese arm of MGM Resorts International reported an increase in share prices in Hong Kong amounting to HK$14.42, representing a 5% improvement from their previous share numbers.
Needing an infusion of good vibes and fortune after the recent struggles of its parent company in the US, the improvement of MGM China’s shares comes at an opportune time, resulting from the finalization of the said land deal that would eventually give rise to the first MGM casino gaming resort on the Cotai strip.
In a statement to the Hong Kong Stock Exchange, the company said: “The board believes that our future development of the Cotai land will offer compelling growth opportunities in the future.”
MGM China isn’t the only casino looking to cobble up some space in the Cotai, a vast area of reclaimed land that has given rise to a huge throng of resorts and casinos in the gambling enclave that is Macau.
To get the proverbial piece of the Cotai pie, MGM China will pay the Macau government a total of $161.4 million for the land with a $56.2 million downpayment and eight subsequent installments of $13.15 million to pay for the remaining $105.2 million.
With the new land, MGM China is envisioning an expansive casino resort that can accommodate 1,600 hotel rooms, 2,500 slot machines, and 500 table games. It’s an undoubtedly huge project for a casino operator that doesn’t have the same foothold in the world’s biggest gambling market as some of its competitors.
MGM China hopes to change that with the addition of this new resort casino in Cotai. And if you’re going to judge their decision to move forward with the project on initial reactions, then that increase in share prices is as good an indication as any that MGM China’s new project is something that has a lot of people excited.