Savan Vegas, Laos Receives Better Offer From Consortium

A new bid has been submitted for the Savan Vegas Hotel and Entertainment Complex in Laos.

The new offer has been made by an entity named as the European-Asian Consortium which is representing several large international casino operators.

The Laos government had initially planned to sell the casino resort through a competitive sale process earlier this year and had shortlisted six proposals but it was reported later by the parent company of one of those shortlisted companies that the tender process had been cancelled.

Subsequently Macau Legend Development Ltd, the Macau-based casino operator announced in May 2016 that it was entering into an agreement with the Laos government to purchase the Savan Vegas casino resort for $42 million along with rights for a 50-year casino monopoly across three provinces in Laos.

One of the provinces was where the Savan Vegas casino was situated. The closure of the deal was however postponed to August 31, with the company saying that negotiations were still going on and the closure date could be pushed back to September 10 if required.

Savan Vegas Hotel & Entertainment Complex, Laos

The consortium’s proposal is much more attractive than the one submitted by Macau Legend. The new proposal will include US$60 million as an initial cash payment, an investment for infrastructure expansion amounting to US$120 million and guaranteed tax payments worth US$220 million over the 50-year period. The consortium also wants a monopoly in three counties for a fifty year period.

Werner Kubesch, the businessman leading the consortium stated that the company had been a part of the competitive sale process for the Savan Vegas property earlier this year but was not shortlisted.

In a statement, Kubesch said

We are aware Macau Legend has been selected, but with deadlines already missed, we hope our counter-offer, which is substantially more beneficial to the Lao government, will be considered favourably, Our consortium is backed by one of the largest hospitality groups in the world, a well-known European based, but globally active casino operator and strong financial partners with extensive regional expertise.

Kubesch said that the timing of their bid was crucial since they are aware that the deadlines for closing the agreement between Macau Legend and the Laos government have been missed. He stated that the consortium’s counter-offer was more attractive and beneficial to the Laos government.

Macau Legend is planning to hold an extraordinary general meeting later this week to get approval from shareholders for the acquisition of the Savan Vegas casino hotel. A spokesperson for the company said that Macau Legend’s discussions with the Laos government regarding the casino were on track and progressing smoothly.

Adrian Sterne

More articles by Adrian Sterne