Melco weighs future of City of Dreams Manila
City of Dreams Manila has a gaming complex, three luxury hotel brands, regional and international specialty restaurants, bars and a spacious retail boulevard.
MANILA, Philippines — Integrated casino report operator Melco Resorts & Entertainment Limited, led by Macau casino tycoon Lawrence Ho, is weighing “strategic options” on the future of City of Dreams Manila.
The Nasdaq-listed gaming firm has retained investment banks CBRE Capital Advisors, Inc. and Moelis & Company LLC as financial advisors to “assist in the process of exploring potential strategic alternatives for City of Dreams Manila,” Melco said in a press statement.
READ: Melco set to undertake capital restructuring.
Melco is “evaluating potential strategic alternatives” in relation to its subsidiary Melco Resorts Leisure (PHP) Corporation or Melco Resorts Leisure, which manages and operates City of Dreams Manila pursuant to an operating agreement entered into by the group and its local partner PremiumLeisure and Amusement, Inc. (PLAI).
PLAI is a subsidiary of Premium Leisure Corp., which holds a license from the Philippine Amusement and Gaming Corp. to operate integrated resorts, including casinos. This is under leisure estate and gaming firm Belle Corp.
“No decision has been made regarding any strategic alternative and there can be no assurance that the exploration of potential strategic alternatives will result in any transaction,” Melco said.
The operator of City of Dreams Manila was delisted from the Philippine Stock Exchange in 2019 after failing to meet the 10-percent minimum public ownership requirement of the bourse for over six months.
READ: Melco involuntarily delisted from PSE.
For the quarter ended Dec. 31 last year, total operating revenues at City of Dreams Manila rose by 11 percent to $133.8 million. Cash flow as measured by earnings before interest, taxes, depreciation and amortization improved by 16.4 percent to $56.8 million during the same period, attributed to better performance in rolling chip and mass market table games segments.
Rolling chip volume jumped by 85 percent to $770.9 million in the fourth quarter from $416.5 million a year ago.
The rolling chip win rate was 4.51 percent versus 3.97 percent in the fourth quarter of 2023, higher than the expected rolling chip win rate range of 2.85 percent to 3.15 percent.
The “win” or “hold” rate of a casino is based on the element of luck but is also affected by gaming limits, a player’s skill and resources and amount of time spent in the casino. While it’s often said that the house always wins, statistical probability is still the name of the game. – Doris Dumlao-Abadilla
