Sands denies Cotai report
A Las Vegas Sands Corp. spokesman on Monday disputed reports in the Asian media that the company is dumping plans to borrow almost $5.25 billion to complete a portion of its Cotai Strip expansion development.
Instead, the casino operator is seeking smaller-scale financing for individual projects on the Cotai region of Macau that are expected to open late next year.
"The company at this point would prefer to keep in place current Macau debt terms, rather than renegotiate an entirely new package,'' Las Vegas Sands spokesman Ron Reese said. "The company has the option of stepping up planned sales of assets, including shopping malls.''
An article published over the weekend in Hong Kong's South China Post said that Las Vegas Sands was halting construction of its projects on the Cotai Strip, a premise Reese flatly denied.
The global economic crisis has challenged Asian credit markets as much as American credit markets. Funding problems have delayed or halted many hotel-casino developments on the Strip, in American regional gaming markets and internationally.
The most notable construction delay on the Strip is Boyd Gaming's shelving of the $4.8 billion Echelon for up to a year.
Reese said development on Cotai is moving forward.
Las Vegas Sands was expected to spend upward of $12 billion to develop the Cotai Strip, which is anchored by the massive Venetian Macau, which opened in August 2007 at a cost of $2.4 billion. A $1 billion Four Seasons Macau opened last August adjacent to The Venetian Macau.
The company is in the process of completing a 6,400-room hotel complex on the Cotai Strip that would include Sheraton, Shangri-La, Traders and St. Regis hotel brands.
Adelson loaned Las Vegas Sands $475 million on Oct. 1 so the company was able to meet liquidity requirements. In addition, the company's stock has fallen some 90 percent in value over the past year.
On Monday, shares of Las Vegas Sands closed at $12.26 on the New York Stock Exchange, down 80 cents, or 6.13 percent.
JPMorgan gaming analyst Joe Greff told investors the news out of Macau shouldn't be a surprise. He said the company is making correct moves on its development plans in the market, including changing around the construction time lines of its multiple Cotai Strip sites.
Meanwhile, Macau media also reported third-quarter gaming revenues were $3.25 billion for the three months ended Sept. 30, a 10 percent decline from a year ago. The Macau Gaming Inspection and Coordination Bureau officially released the figures.
Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.
