Sat, Nov 24, 2007 - Page 11 News List

Huge potential in Taiwan for casinos, magnate says

BIG BUCKS Las Vegas casino industry veteran Larry Woolf compared Taiwan favorably with Macau, which posted US$2.6 billion in third quarter gambling revenue

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Casinos in Taiwan may generate US$3 billion in total annual revenue should legislation to legalize the industry be passed, according to Las Vegas-based industry magnate Larry Woolf, who manages 13 casinos in North America.

"I don't think it'd be too much of a struggle to reach US$1 billion" in revenue each should the government allow three casinos, Woolf, chief executive officer of London-listed Amazing Holdings Plc, said in an interview in Taipei.

The government is considering allowing casinos on islands such as Penghu. Woolf, 63, is betting the legislation will be passed, paving the way for Amazing to open the nation's first casino as rivals Wynn Resorts Ltd and Las Vegas Sands Corp expand in Macau, which reaped US$9.5 billion in gambling revenue in the 12 months to Sept. 30.

"Taiwan's market potential for casino gaming revenue, in the context of large-scale integrated resort and tourism development, is significant," said Jonathan Galaviz, of Las Vegas-based hotel and casino consultancy Globalysis Ltd.

Amazing, which is based in the Isle of Man, plans to spend US$50 million on the first phase of a 300-room hotel resort in Penghu to be opened by the end of 2009, Woolf said. The development, which will eventually be expanded to 600 rooms, is designed to accommodate a casino should the company win a license.

Shares of Amazing, which are listed on the London Stock Exchange's Alternative Investment Market, have surged 61 percent this year and closed at 240 pence each on Thursday.

Woolf, a 40-year casino veteran, built and operated the MGM Grand in Las Vegas which was then the world's largest casino, and opened the most profitable, the Casino Niagara in Canada. His Navegante Group Inc manages at least seven casinos in the US, including the Plaza Hotel & Casino in Las Vegas and the Casino Fandango in Carson City, both in Nevada.

Now Woolf says Taiwan could build the world's largest casino, surpassing the 800-table Venetian Macau opened by Sheldon Adelson's Las Vegas Sands in August.

The DPP government is discussing the feasibility of casinos and seeking public approval before opening up the market, the Government Information Office said in an Aug. 9 statement.

A December 2005 plebiscite of Penghu residents found 57 percent in favor of legalizing casinos, although the turnout for the vote was just 21 percent.

In addition to Penghu, Woolf recently visited Chiayi County, which he says would also be a possible site for a subsequent casino should Amazing be allowed multiple licenses.

"It would take several years and billions of dollars of public and private sector investment to make Taiwan, or one of its islands, into a premiere leisure tourism destination such as Macau," Galaviz said.

Macau's tax rate on casino revenue is 35 percent, compared with Taiwan's corporate tax rate of 25 percent. A tax rate on gambling is yet to be set.

"I like this market more than Macau, especially if the tax rate is lower," Woolf said in the interview on Monday.

Macau's gambling revenue in the third quarter was 20.5 billion patacas (US$2.6 billion), 45 percent higher than a year earlier and up 4 percent on the previous quarter.

Taiwanese make up the largest portion of non-Chinese visitors to Macau's resorts with many also traveling to Las Vegas to gamble, according to Henry Tsai (蔡銘志), assistant professor of hotel and tourism management at Hong Kong Polytechnic University.

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