Biz Buzz: Grand opening … and closing
Being the biggest industry player in another country often has its benefits when setting up shop in another, especially if one has an impressive reputation and has plans to replicate one’s success in the new host nation.
But not if one tries to pull a fast one on regulators or circumvent the rules.
This is what Sun City group—one of the biggest casino junket operators in Macau—is learning the hard way.
That’s because Sun City seemed to have taken over the operations of a small casino outlet located in the lower level of Sofitel Philippine Plaza in Pasay City recently and, Biz Buzz has learned, even hosted a nice little launch party a couple of weeks ago, complete with ribbon-cutting ceremonies and all.
That casino, located near the rear entrance of Sofitel, away from the prying eyes of the general public, is a relatively small operation licensed by Pagcor to a firm called Success Vine Holdings Inc. run by a certain Lin Ruei Ji, who served as its president and chair.
Success Vine obtained a Pagcor license to conduct junket operations—that is, to fly in high-roller clients to play on the premises—in a three-year deal with the casino regulator in August 2014.
Biz Buzz learned that Pagcor’s higher-ups got wind of what looked like a suspicious change in either ownership or management of the establishment after the blessing and soft opening of the relaunched facility where some lower-level Pagcor functionaries were invited.
After the event, these Pagcor officials returned to their office and told their superiors they had just come from the opening of the new casino, to which the senior officials replied in surprise: “What new casino?”
It was only then that they were able to put two and two together and realized that the new operator (which turned out to be Sun City) had not been granted specific permission by Pagcor to take over the operations of the Sofitel outlet.
As a result, a clearly irate Pagcor chair, Andrea Domingo, sent a strongly worded letter to Success Vine (the original licensee) pointing out, in no uncertain terms, that bringing in Sun City into the picture constituted grounds for terminating the license.
That’s because a Pagcor license is like a congressional franchise in that it is granted to a specific party and cannot be transferred to another by sale, lease or sublease, without the permission of the regulator.
“Sun City is not licensed by Pagcor to conduct junket operations at Sofitel Philippine Plaza,” Domingo said. “In view thereof, we demand a written explanation why Success Vine allowed Sun City to conduct blessing and soft opening ceremonies last week. Such act may be considered a ground for suspension or termination by Pagcor pursuant to the agreement.”
Of course, Sun City is a big player in the region and they do have other operations in the Philippines, namely in Solaire Resort and Casino and at City of Dreams Manila. How those other junket operations will be affected by their run-in with Pagcor is anybody’s guess.
But what happened to the Sofitel facility? Just a few days after its opening ceremonies, it was immediately shut down, to the embarrassment of its management. Tsk tsk. —DAXIM L. LUCAS
BDO’s Shell House
We’ve seen BDO Unibank grow from a niche player to the country’s biggest lender in the last two decades, mostly by acquiring banks—big and small—almost every year at the turn of the millennium. By now, BDO chair Teresita Sy and president Nestor Tan are experts in mergers and acquisitions (M&As).
BDO has also built a significant office property portfolio, mostly for its own use. After taking over Equitable PCI Bank, it got hold of PCI Bank Towers at the corner of Makati Avenue and HV Dela Costa as well as the Equitable PCI Bank Tower along Paseo de Roxas. In Ortigas, it has also invested more than P2 billion to build the 47-storey BDO Corporate Center above The Podium mall.
But BDO’s M&A deals may not only involve banks. The most recent addition to BDO’s office portfolio is low-rise office building Shell House along Valero Street in Makati, which, as its name implies, is currently used as the Philippine corporate headquarters of century-old Royal Dutch Shell. Pilipinas Shell Petroleum Corp. debuted on the local stock exchange last year.
BDO acquired the Shell House sometime last year, an industry source confirmed. But for now, BDO doesn’t have any specific plan to redevelop this prime asset and intends to keep Pilipinas Shell as its tenant.
But in the future—especially in the Makati central business district where land is scarce, we know that BDO can unlock more values by building a new office tower on this site. —DORIS DUMLAO-ABADILLA
Speaking of which…
Commercial establishments in the country have been quick to beef up security measures ever since the June 2 incident in Resorts World Manila where a lone gunman torched casino tables and gaming machines resulting in 38 fatalities. But at least one casino owner isn’t too worried about the situation, saying his own facility is already running a tight ship — tighter than usual, even long before the current string of security threats came to the fore.
We’re, of course, talking about tycoon Enrique Razon Jr., who said security measures at his Solaire Resort and Casino were first tightened in the wake of last year’s Davao City bombing and had remained tight since.
Just how tight? Razon said his establishment employed 400 security personnel (that’s just 100 short of a full infantry battalion) who were deployed inside the facilities and on the perimeter. They even have some deployed in boats patrolling the bayside section of Solaire. The casino resort also employs a score of K-9 teams plus the highest tech surveillance and CCTV facilities.
“We even have security people watching the security people,” said the businessman during last week’s stockholders meeting of Bloomberry Resorts Corp. which owns Solaire.
The security team of the casino is run by two experienced executives, one an expatriate security expert with many years of experience in the gaming industry, and the other, a Filipino who is formerly a ranking official of the Philippine National Police. We’re talking about Michael Ray Aquino and if that name sounds familiar, that’s because he is a former intelligence officer of the PNP and key aide of former PNP chief and now Sen. Panfilo Lacson.
Incidentally, Razon revealed that the late Resorts World gunman, Jessie Carlos, was at one point a client at Solaire. “He was last on the premises in May of 2016,” Razon said. “We have his picture.” —DAXIM L. LUCAS
Child-friendly corporations
The Philippines’ largest corporations are big spenders when it comes to corporate social responsibility initiatives. From “millions” in the past decade, the total bill for charitable work for local firms now runs into the “billions.”
The favorite areas where companies channel their resources is education and housing, two vital areas of society where corporate generosity is badly needed.
But there’s another sector that’s just as important—if not more important—which the United Nations agency Unicef wants Filipino business leaders to pay attention to: children’s rights.
On Wednesday, Unicef will launch an initiative with the Makati Business Club called the Children’s Rights and Business Principles (CRBP).
Developed by Unicef, the UN Global Compact and Save the Children, CRBP is the first comprehensive set of principles to guide private sector companies on the full range of actions that can take in the workplace, marketplace and community to respect and support children’s rights. While the business and human rights agenda had evolved significantly in recent years, a child rights perspective has yet to be sufficiently addressed.
CRBP is built on existing standards, initiatives and best practices related to business and children, and seek to fill gaps to present a coherent vision for business to maximize positive impacts and minimize negative impacts on children.
Leading the charge is Unicef country head Lotta Sylwander who has enlisted the aid of Ayala Corp. chair Jaime Augusto Zobel de Ayala and MBC chair Edgar Chua to encourage other Filipino firms to adopt child-friendly principles in their business practices.
The ways companies can join are many. Telecommunications firms have committed to block access to child pornography websites. In the case of retail giant SM, it has committed to ensure that the iodized salt it sells in its supermarkets have the required level of iodine to help in child development.
With the largest Philippine companies already signing up for the program, others are expected to be inspired as well. —DAXIM L. LUCAS
