Belle Corp. seeks more Entertainment City land; Melco Crown share sale a hit

TAGs: Belle Corporation, entertainment city, Melco Crown Entertainment, PAGCOR, Philippines

belle-corp-entertainment-cityPhilippine gaming and property development outfit Belle Corp. saw profits rise an astounding 1,382% to P777m (US $18.8m) in Q1 2013. The division of Henry Sy’s SM Group attributed the uptick to P949.6m in new revenue from the lease agreement Belle signed with casino operator Melco Crown Entertainment. The joint venture of Belle and Melco Crown is currently constructing the Belle Grande integrated resort-casino on 6.2 hectares of land in Manila’s Entertainment City project. Belle CFO Manuel Gana said he expects the company to earn $35m in annual rental income from Melco Crown in addition to Belle’s 50% share of the gaming revenue once the casino opens for business in 2014.

So what to do with that extra cash? Buy more land, that’s what. Belle is seeking to acquire an additional 10-hectare lot in the Entertainment City zone from the state-owned Philippine Amusement and Gaming Corporation (PAGCOR) and other private owners. Belle deputy head Armin Antonio Raquel-Santos told Rappler that the company has already invested $700m into the project, but “we still need more land. We’ve committed to reach the $1b mark in investment.” While PAGCOR has yet to respond to Belle’s request, Raquel-Santos said he expects the additional property will be Belle’s within the next couple years.

Meanwhile, Melco Crown needs a way to pay its Belle landlord. Thankfully, its local subsidiary Melco Crown (Philippines) Resorts Corp. successfully pulled off a $377m share placement on Wednesday. UBS Philippines managing director Lauro Baja III told GMA News that despite the shares being priced at P14 – the top end of the expected price range – the offering was “six-times oversubscribed with 140 investors.” Seems those in the know are betting big on Entertainment City being a popular stop on the Asia-Pacific casino circuit.


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