U.S.-listed Macau junket denied HK dual listing

Liniu Technology

12/02/2015 02:47

HONG KONG, Feb 12 (Reuters) - U.S.-listed Macau junket 
operator Iao Kun Group Holding Co Ltd  IKGH.O  on Thursday said 
its application for a Hong Kong dual listing had been rejected 
due to its declining performance and uncertain outlook. 
    Mid-sized Iao Kun, which runs VIP baccarat tables in the 
world's gaming capital, said the Hong Kong stock exchange 
blocked the plan citing "overall market conditions and the 
near-term industrial outlook in Macau", among other factors. 
    The setback for Iao Kun comes as Beijing's crackdown on 
corruption continues to play havoc with gaming revenues in the 
southern territory, the only place in China where casinos 
operate legally. 
    Many major junket operators, which extend credit to wealthy 
punters and facilitate their transport and accommodation, have 
been forced to close rooms due to lacklustre demand and 
escalating bad debts, according to junket company records. 
    Gambling revenue in Macau has slumped for 8 months in a row 
and February revenues are expected to plunge 40 percent year on 
year, as the crackdown keeps wealthy gamblers away and curbs 
lavish spending.  ID:nL4N0VG0BU  
    Analysts are mostly negative on the short-term outlook for 
Macau, with revenue growth from high-rollers expected to 
deteriorate further, putting more pressure for companies to 
squeeze profit from the mass market of lower-spending players.   
    "With the larger junkets now facing increasing sector 
pressures, we believe it is increasingly likely that ancillary 
non-gaming services will be scaled back or terminated," Daiwa 
Securities analyst Jamie Soo said in Hong Kong. 
    That could hurt events like film festivals, concerts and 
sports tournaments, which junkets have previously sponsored as a 
way of attracting a broader spectrum of visitors besides VIP 
gamblers.  
    Iao Kun, which operates VIP rooms through its subsidiaries, 
said the company was committed to exploring further 
opportunities including strategic investments and finding VIP 
rooms in new locations.  
 
 (Reporting by Farah Master; Editing by Stephen Coates) 
 ((farah.master@thomsonreuters.com; +852 28431631 , +852 9631 
8262; Reuters Messaging: 
farah.master.thomsonreuters@thomsonreuters.net)) 
 
Keywords: IAO KUN GROUP LISTING/