Genting Singapore has notified the Singapore Exchange that it plans to raise up to ¥3.24 billion in yen-denominated corporate bonds, with proceeds earmarked for its proposed integrated resort project in Japan.
The operator of Resorts World Sentosa—one of only two casinos in Singapore—said in a shelf registration filed with the Kanto Local Finance Bureau that the bond sale could begin as early as Oct. 16 and remain open through October 2021. The company noted it will provide a supplemental filing outlining terms and conditions once the actual issuance takes place.
Like rivals MGM Resorts International and Galaxy Entertainment, Genting Singapore is targeting Osaka, Japan’s third-largest city, for its casino development plans. The project is part of a hotly contested race for one of the country’s three highly sought-after gaming licenses.
Competitive Edge
Analysts view Genting Singapore as a strong contender, partly because Japanese regulators hope their integrated resort model mirrors Singapore’s success—where Marina Bay Sands and Resorts World Sentosa thrive without significant negative social impacts.
Another advantage is Genting Singapore’s financial health. The company boasts a balance sheet with nearly four times more cash than liabilities, a factor expected to appeal to Japanese authorities. Earlier this year, Moody’s reaffirmed Genting Singapore’s A3 credit rating with a “stable” outlook, citing its low credit risk. However, the ratings agency cautioned that heavy debt issuance tied to the Japan project could weigh on its outlook.
Funding Challenges Ahead
The full cost of developing a Japanese integrated resort remains uncertain, but estimates continue to rise. Fitch Ratings recently raised its forecast to between $10 billion and $15 billion, suggesting that Genting’s initial ¥3.24 billion bond sale is only the beginning.
Genting may also face pressure to accelerate fundraising efforts, as rival MGM is reportedly preparing to break ground on an Osaka casino as early as 2021, aiming to open doors by 2025 in time for the city’s World Expo.
Details on the yield and coupon rates for Genting’s bond issuance have yet to be disclosed.
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