Stanley Ho to Push For SJM IPO Again

Written on December 2, 2007 by admin

After just celebrating his 88th birthday, it seems that Stanley Ho once again tries to push his long awaited Hong Kong listing. His biggest stumbling block will be his disgruntled and estranged sister Winnie Ho, who has managed so far to stop Stanley Ho from listing his casino empire. Unless he resolves his long running STDM shareholding dispute over US$385 million with her (Another Stanley and Winnie Ho Round) we cannot see a SJM IPO listing in the foreseeable future soon.

Obviously, he needs the cash to fund his long awaited Oceanus project and spruce up his aging casino empire which are long overdue for refurbishment in the now fiercely competitive Macau casino market.

Reports from Hong Kong Thursday indicate that the company is to seek exchange approval for a Hong Kong IPO to raise at least US$1 billion (HK$7.8 billion), for Macau expansion plans. The company announced IPO intentions in early 2006, and has appointed Deutsche Bank to sponsor a listing it hopes will take place in January, sources said.

Last year, Macau overtook the Las Vegas Strip as the world’s largest gaming market, and SJM is betting on a gaming market where gross revenue could grow by more than 23 percent a year through 2010, according to a Credit Suisse report.

“Stanley Ho’s got a lot of long-term connections with the VIPs,” said Morgan Stanley analyst Rob Hart, referring to big-spending high-rollers who have been key contributors to Macau’s gaming boom. “He also has a lot of land, which has a lot of long- term potential given Macau’s small size.”

Macau is the only place in China where casino gaming is legal, and Ho is still the main operator despite the admission of other companies. “Their market share is standing at 37 percent, with Las Vegas Sands at 24 percent, and that’s even after the Venetian opening, so they still are the biggest player out there,” said Hart.

Reuters reports that BNP Paribas and CLSA will co-lead the SJM offering, with another presently unidentified bank possibly joining the underwriting group.