Wynn-fall: LV Strip king scores in Macau

Sunday, March 5, 2006 | 7:15 a.m.

Las Vegas-based Wynn Resorts has entered into an agreement to sell a sub-concession for the right to build a Macau casino to Australian-based Publishing and Broadcasting Ltd. for close to $1 billion, the Las Vegas Sun has learned.

The deal would be - by far - the biggest such Macau sub-concession sale, and would be a jaw-dropping cash infusion to Wynn Resorts, which is spending $1.1 billion on its own Wynn Macau, slated to open in September.

PBL is controlled by the family of the late Australian billionaire Kerry Packer, with about 40 percent of the company's shares. In addition to some of Australia's top magazine and broadcasting assets, PBL owns Crown, the country's leading casino operator. Packer died in December.

Packer's son James Packer, PBL chairman, was not available to comment on the deal; nor was Wynn Resorts Chairman Steve Wynn.

The agreement to sell the Macau sub-concession is Wynn's first move to capitalize on his ability to use his right as one of the Chinese semi-autonomous enclave's three casino concession holders to sell sub-concessions to other operators.

The former Macau casino monopoly holder Stanley Ho and Hong Kong-based Galaxy Casino Co. Ltd. were the other two concession winners. The Macau government granted Venetian-parent Las Vegas Sands a special sub-concession from Galaxy after its partnership with Galaxy dissolved.

Ho sold a sub-concession to a partnership controlled by his daughter Pansy Ho and Las Vegas-based MGM Mirage. The Pansy Ho-MGM Mirage combination plans to open a $1 billion-plus MGM Grand late in 2007. Stanley Ho reportedly was paid about $250 million for the MGM Grand Macau sub-concession.

Wynn is believed to be able to command a premium for his Macau sub-concession because he has far less regulatory baggage than Stanley Ho and Galaxy. MGM Mirage's partnership with Pansy Ho is now undergoing scrutiny by Nevada and New Jersey gaming regulators, with Pansy Ho's reputed independence of her father at issue.

The nearly $1 billion sale to PBL would be a gigantic cash infusion to Wynn Resorts. The windfall is more than double the $443.3 million in net income reported last year by Nevada's biggest casino operator, MGM Mirage, and far more than the $236.4 million reported as net income by the world's biggest casino operator, Las Vegas-based Harrah's Entertainment.