The President of Sands China Ltd, Dr Wilfred Wong, says the Macau government will inevitably need to consider an extension to the gaming concessions of the citys six current concessionaires given the tight timeline before they expire.
The government has previously outlined its intention to start the re-tendering process for gaming concessions, starting with a public consultation process around potential changes to Macaus gaming laws, in the second half of this year.
However, with the licenses of all six concessionaires due to expire in June 2022, it has been suggested that an extension of up to three years could provide the government with additional time given the significant distraction of the global COVID-19 pandemic.
Speaking during Las Vegas Sands 2Q21 earnings call on Thursday morning (Asia time), Dr Wong said such an extension must at least be a strong consideration.
Obviously the extension is a very complicated issue, its something that the Macau government and the Chinese government will have to look at very carefully, he said, adding that he doesnt expect the public consultation process to start until after the legislative council elections on 12 September.
I dont think the government is in a rush to review the license because they want to do things right and as we all know there are many legal issues they have to attend to, such as the concession and sub-concession issue, and this they can only go to the legislative council when the new council in place.
At this stage we are really focusing on doing our best and aligning our interests with the government, such as focusing on investment and reinvestment opportunities, building our properties, improving our operational facilities and maintaining a stable workforce which is very important during this pandemic.
I think things will pan out eventually because as we move closer to the expiry of the concession, naturally the extension of the concession is an option which the government will have to look at.
According to Dr Wong, the issue of concession renewal is likely back of mind for the government right now given more pressing issues around the virus.
They have their own preoccupation at this stage, he said. The Macau government, apart from still working very hard on making sure Macau remains a safe city and all the precautionary measures against COVID, are now preparing for the next legislative council election. The government is operating at a pace where they feel they want to launch the public consultation for the concession renewal towards the second half of this year which we believe might mean it will only happen after the legislative council election.
Under current law, Macaus gaming concessions can each be extended by up to five years, however a three-year extension is seen as most likely given that SJM and MGM have already had their concessions extended by two years to match up with the June 2022 expiry of the other four concession holders Galaxy Entertainment Group, Melco Resorts, Sands China and Wynn Macau.
Delay or not, LVS Chairman and CEO Robert Goldstein said he was confident the company would be successful in its bid for a new license.
We remain very comfortable with our position, he said. We have to be patient but we have led the efforts in Macau towards a diversified approach to development, weve gone above and beyond, Sheldon was the guy behind the Cotai development, weve invested US$15 billion-plus and we have followed the government advice and direction.
So we remain very confident and very patient waiting for the governments decision. There is nothing new.