Tuesday, April 28, 2009

Crown confident in Macau growth outlook - 29th April 2009

Casinos operator Crown Ltd has bought more shares in its joint-venture casino operator and developer in Macau, Melco Crown Entertainment Ltd (MPEL), and expressed confidence in the growth outlook for the Chinese enclave.

MPEL operates the Altira Macau, formerly known as Crown Macau, which opened in May 2007.

MPEL is also developing the City of Dreams casino resort at Cotai in Macau.

MPEL's major shareholders are Crown and the Hong Kong-listed Melco International Development Ltd (Melco).

Crown said on Wednesday that it had agreed to take $US45 million ($A63.71 million) in additional equity in MPEL's $US165 million ($A233.61 million) equity placement.

The placement may rise to $US180 million ($A254.85 million) if an over allotment option is exercised.

Melco has participated in the MPEL placement on the same terms as Crown.

Crown said the cost of its cash equity investment in MPEL, including the new shares, was now $US500 million ($A707.91 million).

Following the MPEL placement and assuming full exercise of the over allotment option, Crown's ownership interest in MPEL will be diluted slightly to 36.4 per cent.

"The substantial participation in this transaction by the founding shareholders of the company - Melco International and Crown Ltd - confirms our confidence in the growth outlook for Macau and Melco Crown Entertainment's competitive position within the market," Crown executive chairman James Packer, who is also co-chairman of MPEL, said.

"I am convinced that City of Dreams will set a new standard for casino development in Asia."

MPEL said that City of Dreams remained on track to open in early June and on budget.

Crown shares were steady at $6.42 at 1230 AEST on Wednesday.

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