Macau casino giant eyes $175-$450 M from share sale

MANILA, Philippines - The Philippine unit of Macau casino giant Melco Crown Entertainment Ltd. is reportedly looking to raise between $175 million to $450 million from a share sale, sources said over the weekend.

Sources said publicly-listed Manchester International Holdings Unlimited Corp., which will soon be renamed Melco Crown (Philippines) Resorts Corp., has tapped ATR Kim-Eng Capital Partners Inc., Citigroup, and UBS as financial advisors for its planned equity offering.

Manchester last week approved the sale of up to 1.2 billion shares to help fund its $580 million to $600-million financial commitment to a casino joint venture with retail tycoon Henry Sy’s Belle Corp.

Melco, a partnership between Australian billionaire James Packer and the son of Macau gambling tycoon Stanley Ho acquired 93.1 percent of Manchester in a backdoor listing deal in December to serve as the group’s vehicle for a $1-billion casino project in Manila.

Details of the offering like the timing and terms have yet to be firmed up by the company, which used to be an illiquid stock with interests in pharmaceutical and real estate businesses.

Manchester A shares closed 1.68 percent higher Friday at P16.96 per share while the class B shares, traded by both local and foreign investors, declined by 2.4 percent to P16.22 per share.

To carry out the planned fund-raising activity, Manchester is beefing up its capitalization to P5.9 billion from P900 million with a unit of Melco subscribing to 2.85 billion shares or 56.9 percent out of the total increase.

Aside from the equity sale, Melco intends to tap debt amounting to around $325 million to fund the project.

Melco and Belle, an upscale leisure developer and gaming firm,  will each have an estimated economic interest of 50 percent in the project. The Macau gambling firm, which owns the successful City of Dreams urban resort, the Altira boutique casino in Macau and a chain of gaming machines under the Mocha Club brand, will operate the integrated resort located along Manila Bay.

Economic interest from the project will be derived from the gaming revenues and the lease of commercial space in the entertainment center.

The project, which will house 350 gaming tables and 1,900 slot machines on almost 20,000 square meters of gaming area surrounded by six hotels, marks Melco’s first foray in the Philippine gambling market, which is forecast to hit $3 billion in revenues by 2015.