Is Genting Singapore to launch Echo bid?
Australian casino operator Echo Entertainment is rumoured to be a potential acquisition target for Genting Singapore, the owner of the Resorts World Sentosa integrated resort.
Echo, which demerged from Tabcorp’s wagering business last year, has been the subject of speculation previously, with fellow Australian operator Crown said to be keen to up its existing 10 per cent stake in the business.
Now, however, the Wall Street Journal is suggesting that Genting is poised to launch its own bid for the company.
“Our analysis suggests that Genting Singapore could comfortably pay AU$6 – AU$6.50 a share, a 35-50 per cent premium to Echo’s current share price,” said Macquarie analyst Gary Pinge.
This would place Echo’s value at nearly AU$4.5bn.
Australia’s tourism industry is attempting to draw a larger number of Asian consumers over the coming years, focusing particularly on the Asian VIP gaming dollar.
The acquisition of Echo would mean Genting is strategically placed to take advantage of this.
Bloomberry Resorts Corp plans to invest more than $1bn in an integrated casino complex in South Korea and is in talks with a potential Korean partner for the project.
Revenue in Australian casinos is expected to rise to $6.2bn by the end of the decade.
The flagship casino of the Olympic Entertainment Group will open in Tallinn, Estonia, next year.
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