Posted on: May 30, 2023, 09:03h.
Last updated on: May 30, 2023, 09:09h.
The Philippines government owns and operates 43 casinos across the Southeast Asia nation. And with considerations to sell the properties ongoing, a top government official says numerous gaming companies have expressed interest in potentially buying the facilities.
The Philippines is home to one of the richest commercial casino markets in the world. Casinos in the island nation won more than $3.3 billion off gamblers last year, which nearly returned the market to its pre-pandemic levels.
The bulk of the revenue is generated by the four integrated resorts in Manila, — Resorts World, City of Dreams, Solaire, and Okada. The commercial resorts are regulated by PAGCOR, the Philippines Amusement and Gaming Corporation.
In addition to regulating casino activities across the country, PAGCOR operates its own casinos under the Casino Filipino brand. PAGCOR operates nine full-scale casinos and 34 satellite branch locations, the latter being small casino hotel lounges and retail gaming facilities.
Top officials in the Philippines have been considering divesting PAGCOR’s owned and operated casinos for many years. Previous President Rodrigo Duterte strongly considered selling off the Casino Filipino properties but later decided to retain PAGCOR as an operator and regulator amid the pandemic.
Duterte’s successor, President Bongbong Marcos, recently renewed the conversation in order to generate quick cash for the government. The Philippines saw its tax revenue plummet during the pandemic.
Marcos and PAGCOR leaders are seeking nearly $1.5 billion for the 34 properties. PAGCOR-generated gross gaming revenue (GGR) last year totaled only $290 million, down from $680 million in 2019.
Gaming analysts at Morgan Stanley opined in a March note that the PHP80 billion ($1.42) billion asking price is likely too steep.
“Buying interest could be low [at that price],” wrote analysts Praveen Choudhary, Dan Chee, Jeffrey Mak, and Gareth Leung. Analysts at Maybank Securities shared a similar sentiment because the PAGCOR properties will likely need considerable upgrades to make them attractive to commercial operators.
PAGCOR chair Alejandro Tengco told GGRAsia this week the analysts are wrong.
So many foreign and local groups have already expressed interest,” Tengco said of the possible sale. “I told them we’re not ready to entertain bids.”
But PAGCOR, Tengco explained, could be ready to field offers sometime in 2025.
Bundle Over Piecemeal
Asked whether PAGCOR and the Philippines would consider selling its casinos individually, Tengco said the country will seek bids to unload the properties in bulk.
“As of now, the idea is to sell it as a bundled thing,” Tengco explained.
PAGCOR’s most coveted casino assets are its nine full-fledged casinos, and specifically, the corporation’s two properties in Manila, the New Coast and Ronquillo. Casino Filipino’s other flagships are in Angeles, Bacolod, Cebu, Davao, Ilocos Norte, Olongapo, and Tagaytay.
The Philippines is expected to benefit from China’s recent crackdown on VIP junket groups in Macau. After being forced out of Macau, those high-roller travel organizers are expected to relocate their operations, and the Philippines has emerged as an attractive destination.
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