Yokohama’s decision to withdraw from the IR bid could have a negative impact on Genting Singapore Ltd, one of the contenders for the partnership spot.
Brokerage Morgan Stanley Asia Ltd. noted that the project could have brought the company net present value of SGD0.13 ($0.10) per share, reported GGRAsia.
Genting Singapore has cash reserves of SGD3bn, but the analysts stated there are additional financial obligations for the company. Genting Singapore operates the Resorts World Sentosa casino complex in Singapore and in 2019, the company promised the government to invest close to SGD4.5bn to the expansion of the property.
The expansion is set to include two hotels and upgrade its S.E.A. Aquarium to a new Singapore Oceanarium. “Resorts World Sentosa 2.0 will see an expansion of about 50% new gross floor area, adding over 164,000 square metres of new and exciting attractions, entertainment and lifestyle offerings,” said Genting Singapore at the time.
Another analyst firm, PublicInvest Research, presented a more optimistic outlook for Genting Singapore, stating the company might see a rise in performance in Singapore since the country is handling the Covid-19 pandemic better than neighbouring regions. The firm, however, cautioned the earnings might take a hit regardless, due to prolonged lockdown.
Another company aiming for Yokohama’s IR licence was Melco Resorts & Entertainment, and Morgan Stanley noted that the drop-out might be a good thing for the company that had $4.8bn in debt recorded in June. Lawrence Ho Yau Lung, Chairman and Chief Executive of Melco Resorts, said that while the company is closing its Yokohama office, it will keep a representative office in Tokyo.