FEC chairman Robert John Sobrepeña said the move is in line with efforts to diversify the company’s revenue streams and capitalize on the booming casino gaming sector.
He said the prospective foreign investors have proposed a 50-50 sharing and that a new company may be formed to serve as the corporate vehicle for the venture.
Negotiations are expected to be completed by January next year.
The Hong Kong-based firm is into property development in China and is engaged in casino gaming in Macau while the US firm has proposed to put up the project financing.
Sobrepeña said they are looking at locating the casino operations within Camp John Hay in Baguio. The venture, he said, requires a budget of $200 million.
Worldwide casino gaming is a $68-billion industry seen to grow to $100 billion by 2009. In Asia-Pacific, it is an $8.8-billion industry and projected to grow to $18.5 billion in 2009 with Macau accounting for 86 percent of the market.
"We’re going into casino gaming because of its huge potential for growth," Sobrepeña said.
Casino gaming consists of games played within brick-and-mortar casinos, including land-based casinos, riverboats, dockside casinos, tribal casinos, casinos at racetracks (or racinos), and limited-stakes casinos.
The United States will remain the world’s largest market for casino gaming, increasing from $47.3 billion in 2004 to $64.1 billion in 2009 at a 6.3 percent compounded annual growth rate (CAGR). The EMEA region (Europe, Middle East, Africa) will grow from $9.8 billion in 2004 to $14.3 billion in 2009 at a 7.9 percent CAGR.
Asia/Pacific will expand by 15.9 percent CAGR, the fastest among all regions, from $8.8 billion in 2004 although the revenue base will remain small, rising from $83 million 2004 to $150 million in 2009.
FEC’s key investment is in the form of equity interest in Metro Rail Transit Holdings (MRTH), Inc. and Metro Rail Transit Holdings 2 (MRTH2). The combined investment in these two holding companies represents approximately 28.5 percent interest in the MRT phase I train system which runs from North Triangle and Taft Avenue.