Asian casino developer Melco Resorts & Entertainment Ltd. is in preliminary talks with Premium Leiure Corp. of retail tycoon Henry Sy Sr. over the possible sale of a stake in local Philippine operating unit Melco Resorts Entertainment (Philippines) Corp.
Melco said in a disclosure to the stock exchange it was notified by its controlling shareholder “in relation to a potential transaction whereby PLC or its affiliated entities may become equity holders” of the company.
PLC, the gaming unit of Belle Corp., has an operating agreement with Melco that entitles the company to a share in gaming revenues in the City of Dreams Manila, an integrated resort and gaming facility within government-sponsored Pagcor Entertainment City.
“Please note that there is no assurance that any transaction will occur and any transaction will be subject to entry into definitive agreements,” Melco said.
“As these discussions remain preliminary, there is no additional information to be reported by the corporation at this time. The corporation will comply with its disclosure obligation if any material changes to its business operations and developments are to occur,” it added.
Belle Corp. president Manuel Gana said in April it proposed to Melco the expansion of COD Manila using a one-hectare property that is adjacent to the gaming complex.
The planned expansion involves additional non-gaming facilities like hotels and ballrooms.
Gana said COD Manila, which has 900 hotel rooms across three brands, had a average occupancy rate of over 90 percent.
Gana said the expansion would involve non-gaming facilities, noting that COD still had room to add gaming tables and machines within the existing gaming complex.
Melco reported a net income of P531.9 million in the first quarter of 2018, up 258 percent from P148.5 million year-on-year.
First-quarter operating revenues declined 7 percent to P7.35 billion from P7.8 billion as casino revenues fell 20 percent to P5.83 billion.