Reports by Bloomberg claim MGM Resorts International recently approached the Lim family – the controlling shareholders of Genting Singapore – to sound out the cost of acquiring its stake in the business.
The Lim family owns an estimated 53% of Genting Singapore, a company worth around $7bn.
The operator's stock price has lept by 9% following this news, the highest rise in Genting Singapore's stock in almost two years.
Genting Singapore is one of just two casino operators in Singapore, the other being Sands, which operates the 1.4m square-foot Marina Bay Sands casino.
Genting’s properties include Resorts World Sentosa, a 49,000 square-metre destination on Singapore’s southern coast.
So far, there is no certainty that negotiations between MGM Resorts and Genting will lead to a transaction, but should they do, MGM Resorts will enter Singapore’s market with a significant disadvantage.
Sands’ Marina Bay property is an aesthetic icon of the country's casino industry, and it is much larger than the property sought by MGM Resorts.
Perhaps MGM Resorts has plans to expand Genting’s property, but this would consume more time and funds, possibly delaying the impact MGM Resorts has upon its entry into Singapore's market.
Furthermore, a move to acquire Genting’s operations would be subject to stringent regulatory checks, with MGM Resorts needing approval from the Singapore Government before any sale or subdivision can occur.
As of yet, Singapore’s Government has yet to receive any request from Genting’s Sentosa property regarding a change of ownership.
