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Hopes of legalizing gambling at casinos in Japan may have been thwarted after Prime Minister Shinzo Abe announced that he was resigning from office due to fitness issues.
Already suffering from giants like Las Vegas Sands (NYSE: LVS), Wynn Resorts and Genting Singapore that refloute this opportunity, the loss of one of the industry’s biggest supporters within the Japanese government may be the death sentence for legalized casino games.
Although analysts once saw the casino market legalized as a $40 billion prospective industry, competing with Macau in China at its peak, the outlook has deteriorated over time as public opposition to measure remains the industry’s main and regulatory procedure continues.
MGM Resorts (NYSE: MGM), which is the favorite to win one of the first 3 concessions to be awarded, even covers your future bets, although it claims to be in a position to submit its proposal as soon as the regulation is regulated. instead, it now indicates that it only needs a minority stake in the transaction.
President and CEO Bill Hornbuckle also said he will “only make this investment if we think it will be prudent, if we think he will pay the kind of return he has to pay and meet our expectations. “
It’s the same kind of misunderstanding that Las Vegas Sands followed just before retiring from the race six months later.
And now that the final regulations, which were ready to be in force until the end of July, but have been delayed due to the COVID-19 epidemic, would possibly not see the softness of the day until early next year or they would see nothing. Japan’s position in the casino market would possibly have died before it had had a chance to thrive.
This is a remarkable change, given that station operators first outperformed each other what they intended to spend on creating a built-in complex if they won a concession, with estimates of up to $10 billion or more.
MGM was putting all its chips in Osaka City by winning the hosting offer of a resort and partnered with The Japanese monetary corporation Orix to expand a “Osaka First” policy to create a joint venture to own and operate the built-in complex.
However, at MGM’s earnings convention last month, Hornbuckle said MGM was only looking for a 40-45% stake in the company, as it would restrict its investment and casino-related threat.
While he also said that “we like where we sit” in relation to the victory of a concession, he also said that MGM appreciates that it is not just about the investment, it is not a resounding endorsement of how it will develop.
With official delays in setting floor rules, cities cannot move forward by opting for complex built-in operators, and casinos themselves cannot expand the plans needed to obtain them if they win.
Abe’s resignation creates even greater uncertainty. Depending on who your successor is, there may be no political will to fight for the built-in stations. Polls show that up to 60% of The Japanese public opposes it.
The country has had a brief opportunity to allow industry to contribute to economic growth, but this moment is over.