Gambling tycoon faces end to monopoly that made his fortune

Elaine Kurtenbach

Friday, June 15, 2001 | 10:43 a.m.

MACAU -- It's sundown on a Friday evening and the crowds around the baccarat tables at the Lisboa Casino are getting down to the serious business of gambling.

At the Jai Alai Palace, the Mandarin Oriental, the New Century and the Pousada Marina Infante, the scene's basically the same, and the proceeds are all going to one man -- Stanley Ho.

Gambling is the business of this sleepy port city on China's southern coast, and for almost 40 years, Ho has been its boss.

But Ho's days as a monopolist are numbered. The Macau government has announced it will not renew Ho's gambling concession when it expires at the end of this year.

Dapper and fit at 80 years old, Ho seems untroubled.

"It's 40 years I've worked in the casino. It's high time the government should abolish the monopoly," Ho said in an interview at his penthouse office atop the Macau Ferry Terminal on Hong Kong's skyscraper-studded waterfront.

"We are not worried. We are the biggest company in Macau and the richest company," said Ho, whose assets have been valued at $1.8 billion by Forbes magazine.

Ho has been diversifying his business for years. He has invested in casinos in Portugal, Spain, Australia, Vietnam and North Korea. He has a small executive charter service called Jet Asia, and now the gambling empire is expanding into cyberspace with an online casino, DrHo.com.

The website, run by a son-in-law of Ho's, presents a jet-setting virtual world of zippy jetfoils, Rolls Royces, dog racing and roulette.

In real life, Ho's Lisboa Hotel -- marble floors, massive jade carvings and famed French chef Joel Robuchon -- exudes opulence. But there is little Las Vegas-style glamour in the casino, where patrons gather grimly beside gaming tables in a warren of crowded, rundown rooms.

Ho's 11 casinos account for more than half of Macau's economic activity. He owns most of the hotel rooms and the high-speed ferries that shuttle visitors from Hong Kong and other Chinese cities. His dredgers keep Macau's shallow, silty harbors open. Altogether he employs about 15,000 people, one-fifth of the city's workers.

"Since it's so profitable, the company pays relatively well. It provides a means of social mobility for its employees and for those in the civil service," said Antonio Ng, a local lawmaker.

Back in 1962, when Ho acquired the gambling monopoly, the tiny Portuguese enclave 40 miles west of Hong Kong was a dying fishing port deluged with refugees from communist China.

"In those days, the Portuguese said Stanley Ho was a dreamer. I have fulfilled all my promises. I feel rather proud in having succeeded," Ho said.

While his fortune was made in Macau, Ho has spent most of his life in Hong Kong. His wealthy Eurasian family sank into poverty when his father lost its fortune in stock speculation in 1934 and fled to Vietnam.

Ho was working in the air raid warden's office when Hong Kong surrendered to the Japanese in 1941.

"I had to throw away my uniform and run to Macau as a refugee," Ho said. "Macau treated me so well. I went there with 10 dollars in my pocket and became a millionaire before the age of 20."

Ho's first coup was to negotiate a wartime monopoly on trading between Japanese-held Hong Kong and Macau. He credits his success to hard work and "not taking 'No' for an answer."

He is known for his skill at tennis and ballroom dancing, and his reputation is that of a ladies man -- at last count he had fathered 17 children. The one pastime he has not indulged in is gambling.

"I don't gamble at all. I don't have the patience," Ho said. "Don't expect to make money in gambling. It's a house game. It's for the house."

Several of Ho's children are executives in Shun Tak Holdings -- his Hong Kong-based business group. None have gone into the gambling business.

Though he backed the cyber-gaming venture, Ho says he doesn't know how to operate a computer.

"I believe in equity and bricks, not something you think of or imagine," he said.

Ho says profits of his privately held casino company jumped 20 percent in the first four months of 2001, and that Beijing's leaders have reassured him that gambling will continue to be banned elsewhere in China.

Competition in Macau likely won't come right away. Newcomers will need several years to build their casinos, and the government must find a way to finance the round-the-clock dredging Ho's company provides as a condition of the gambling concession.

"I'm afraid they will have to discuss with me," he said with a smile. "They must."