Jimei International Entertainment Group Ltd. is planning to develop a resort in Cambodia’s coastal town of Sihanoukville.
Last week, the Macau junket operator announced that it has a framework agreement in place for a joint venture with other partners for an “entertainment resort complex.”
Jimei’s partners for the said project are Cambodian resort developer Yeejia Tourism Development Company Ltd., and MCC International Incorporation Ltd., a “large comprehensive construction general contract enterprise” in mainland China.
Under the agreement, Yeejia will be in charge of providing the land use rights on the proposed site, as well as all relevant approvals and licenses for the resort, while Jimei will plan the resort and arrange the financing for the venture.
In its filing with the Hong Kong Stock Exchange, Jimei said the complex will have hotel facilities, a golf course, theme park and “other entertainment and tourism business,” but the junket operator didn’t mention if there will be gaming facilities in the resort.
Jimei already has a presence in Cambodia via its partnership with NagaCorp, but analysts believe that it is unlikely that the junket operator’s new project will pose a major threat to NagaWorld.
Union Gaming analyst Grant Govertsen said the resort is already under construction in Sihanoukville. However, the on-again, off-again project—the Golden Silver Gulf resort—has been in development since 2009.
“Should Jimei’s project come to fruition it is likely at least several years away, and the company’s contribution to Naga’s VIP story is likely measured as a single digit percentage of rolling chip volume. While this does represent incremental risk to Naga, we are not inclined to adjust our model at this time,” Govertsen said in a note.
In terms of location, Sihanoukville is located about 130 miles from Phnom Penh with a drive-time of about three hours.
“We would not expect a casino resort in Sihanoukville to gain traction with respect to Naga’s core earnings driver, mass market gaming. Instead, and not surprisingly in the context of Jimei being a VIP operator, we would expect this property to be primarily reliant on inbound VIP customers,” Govertsen said.
