Macau’s Galaxy Entertainment Group is testing the European waters with a “relatively small investment” of $42.3 million in Monaco’s Societe des Bains de Mer et du Cercle des Etrangers a Monaco, also known as SBM.
Galaxy Entertainment Group is expanding beyond Macau. The gaming operator announced it’s acquiring a 5 percent stake in Monaco’s casino firm Societe des Bains de Mer et du Cercle des Etrangers a Monaco, also called SBM.
In a statement, the company said it is making a “relatively small investment” of $42.3 million in SBM.
“This is a minority strategic investment into SBM shares and we are not seeking to purchase more shares,” Galaxy Entertainment Group said. “This is the first step in an exciting partnership with SBM, and we look forward to working closely with SBM for our mutual benefit.”
Monaco-based SBM is listed on the Euronext Paris. Its casino properties include Casino de Monte-Carlo, Casino Café de Paris, Sun Casino and Monte-Carlo Bay Casino.
Luxury goods maker LVMH Moet Hennessy Louis Vuitton is also taking a 5 percent stake in SBM, the Monaco casino firm said in a statement. The state of Monaco is the controlling shareholder of SBM.
This is Galaxy’s first significant investment outside of Macau. Last May, the casino operator opened the Phase 2 venue of its Galaxy Macau resort. GEG chairman Lui Che Woo also vowed to spend $7.4 billion developing Phases 3 and 4, which brings the total outlay of Galaxy Macau to $12.9 billion.
GEG’s Galaxy Macau ranks first among individual performers, raking in a total of $5.85 billion in GGY last year. However, Macau’s overall casino gaming revenue in June fell to its lowest level since 2010 partly due to China’s slowing economy and the country’s anti-corruption drive that is deterring high rollers.
Even the newly-opened Galaxy Macau’s Phase 2 venue reported underwhelming performance. GEG said the new venue had been “satisfactory, but not as good as we expected.” But GEG vice chairman Francis Lui remains positive, saying the Phase 2’s performance will be “better in the next one to two months.”