Wynn Resorts Expresses Unhappiness Over Macau Casino Regulations
When Macau’s casinos lost a combined total of over $100 billion in 2014, the boards of most gaming companies continued to remain optimistic for the casino industry in Macau was responsible for generating a significant amount of their revenue. This was the case for Wynn Resorts as well and CEO and Chairman Steve Wynn has remained patient for all these months and continued to express his confidence in Macau’s gaming industry.
Wynn Resorts is in the process of opening yet another casino in Macau and has invested $4.1 billion in a new casino-resort that is scheduled to open in March 2016 and is hoping that the new casino will help revive Wynn Resort’s business interests in Macau as the company’s revenue in Asia has significantly dropped since the anti-corruption crackdown.
Steve Wynn who is known for being outspoken recently expressed his disappointment with the regulation process in Macau and was very critical of Macau’s gaming authorities. Wynn stated that even though his company has invested $4.1 billion to build another casino Macau, the regulators were not willing to commit how many gaming tables would be permitted in the new casino.
Wynn Resorts plans in Macau are hampered because by not knowing how many gaming tables are allowed, the company cannot go ahead with hiring and training of casino staff. If they do take a chance and hire staff and find out that the gaming tables were lower than their calculations, they will be forced to terminate the staff they hire and will lose both time and money.
In a statement, Steve Wynn said
None of us are really clear on what our environment is going to be like going forward, and it makes planning and adjusting almost a mystical process. The notion that a person who spent $2.5 billion, I’m talking about Melco now, would not know how many tables they’re going to have three weeks before they open is so preposterous that it’s worthy of comment. We are hopeful that we’ll be able to press the issue and get more clarity from the leadership of the local government.
Wynn’s criticism of Macau’s gaming regulations had a negative impact on the company’s stock as shares dropped by 10%. The company shares traded at around $160 in 2014 and during the last 10 months has had a 55% drop and current share prices are around $67. The significant drop in share prices has already cost Steve Wynn around $1 billion of his personal stake in Wynn Resorts.
