Casino operator and gaming chip maker Entertainment Gaming Asia (EGA) has decided to rid itself of its underperforming Dreamworld Pailin casino. The casino, which opened on Cambodia’s border with Thailand in May 2012, has struggled to turn a profit, leading to this January’s decision by EGA to write off the total $2.5m it had invested in the property. In May, EGA reported that the casino’s revenue had fallen 80% to just $216k in the first three months of 2014. A few weeks later, the Thai military staged a coup, which further reduced the number of Thais willing to cross the border to gamble.
On Thursday, EGA announced it was selling the casino for $500k to Cambodian citizen Ban Kea, a relative of EGA’s local partner. The deal, which is expected to close in a couple months, includes all the casino’s assets except the electronic gambling machines and the right to use the Dreamworld brand name. EGA has also terminated the agreements it had with its local partner, who owned the land on which the casino was built. The deal doesn’t affect EGA’s other Cambodian dealings, including its Dreamworld Poipet slots hall and its supply of electronic gaming machines to NagaCorp’s flagship NagaWorld casino in Phnom Penh.
The Thai coup also resulted in a flood of Cambodian migrant workers fleeing Thailand after unfounded rumors spread that the Thai military wanted to purge the country of foreign workers. The estimated 200k Cambodians who fled home have taken up temporary refuge in border towns like Poipet, which is also home to numerous small-scale casinos and sports betting shops. The migrant workers’ presence has forced the government to consider a crackdown on gambling in the wild west border town.
Over the weekend, the Facebook page of Cambodia’s Prime Minister Hun Sen issued the following warning: “Casinos in Phnom Penh and along the border are not for Khmer citizens. Violating this law can affect casinos’ licenses.” The PM’s post went on to warn operators not to offer wagering on the 2014 FIFA World Cup and urged police to deal harshly with anyone who proved unwilling to toe the line. However, the PM issued similar warnings a couple years back that weren’t followed by any significant crackdown, so operators will have to wait to learn if the PM is simply crying ‘wolf’ again.