Angela Leong rubbishes US committee stance on junket operators

angela-leong-congressThe recent criticism of Macau’s casino junket operators by a committee of American political appointees isn’t sitting right with Angela Leong On Kei, the Macau Legislative Council member, director of market leading casino operator SJM Holdings and former wife of Macau casino icon Stanley Ho. Speaking earlier this week at the General Association of Macau Gaming Industry Administrators, Managers and Promoters, Leong took reporters to task for accepting the US-China Economic and Security Review Commission’s claims of junket corruption at face value.

The Macau Post Daily quoted Leong saying she believed that “you, the media, should not just mention what you like or other people’s opinions … I think you should evaluate gaming promoters positively … and promote them positively.” Leong went on to say that Macau’s VIP gaming promoters “have contributed a lot to society, to our economy, senior citizens and residents’ lives.” Macau’s government recently estimated that taxes on junket promoter commissions would rise 1.9% in the coming fiscal year to MOP 683m (US $85.5m).

While business is booming in Macau, competition is fierce, so much so that VIP gaming investor Dore Holdings Ltd. has decided to switch its business focus from the gaming sector to financial services. The Hong Kong-listed Dore, which operates VIP tables at the Venetian Macao, bought 51% of a mainland pawnshop business in July, then acquired the remaining 49% in late October. Despite the fact that junket profits made up 81% of Dore’s revenue in the first six months of its fiscal year, the company has decided the financial services sector “will generate strong and stable revenue for the benefit of shareholders.”

While one company pulls back from the junket brink, another company is eager to take its place. Late last month, Hong Kong-listed frozen food purveyor First Natural Foods Holdings Ltd. announced it would pay HKD 400m ($51.6m) to acquire a 5% stake in junket operator Hang Seng Sociedade Unipessoal Limitada aka Hengsheng Group Ltd., which operates 86 VIP gaming tables across seven different rooms at the StarWorld, Galaxy Macau, Sands Cotai Central, Venetian Macao, MGM and Wynn casinos. The Hang Seng junket generated unaudited net profits of HKD 462m ($59.6m) in the first 10 months of 2013 and First Natural believes its slice of the pie will generate annual income of at least HKD 25m ($3.2m).