Galaxy Entertainment Withdraws from Yokohama Casino Competition

Posted on: May 17, 2021, 09:32h. 

Last updated on: June 30, 2021, 10:00h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

Yokohama’s ambitions of being one of the first three Japanese cities to host an integrated resort suffered another blow Monday when Galaxy Entertainment Group said it’s pulling out of the competition.

Galaxy Yokohama
Francis Lui, deputy chairman of Galaxy Entertainment, seen above. His company is withdrawing from Yokohama. (Image: Bloomberg)

That’s more a commentary on the city than the country because the Chinese gaming company insists it’s still interested in Japan, though it didn’t specify a city or region it’s eyeing in the wake of its Yokohama departure.

We greatly appreciate the opportunity to play an active role in Yokohama’s IR selection process, but have decided to not participate at this time,” said the Hong Kong-listed company in a statement.

Galaxy’s decision to withdraw from the Yokohama fray comes just days after Suncity scrapped plans to pursue an integrated resort in Wakayama Prefecture. That region also remains part of the broader race to procure a Japanese gaming license.

Pressure Mounts on Yokohama

In February, Yokohama officials said one unidentified operator already met early requirements to advance in the gaming property bidding process there. They hope to select a winning partner with which to bid for a casino license this summer.

Still, the loss of Galaxy from the competition is a reminder that operators are losing affinity for Japan’s second-largest city. A year ago, Las Vegas Sands abandoned its Japan ambitions, which centered around Yokohama. The late Sheldon Adelson said the framework governing Japan’s integrated resort process made the gaming company’s goals in the country “unreachable.”

That was the start of rough operator-level news for Yokohama. In February, Wynn Resorts withdrew from the city’s request for proposal (RFP) process after shuttering its office there last August.

The departures of Galaxy, Las Vegas Sands, and Wynn from the Yokohama race could hurt the city’s chances of claiming a gaming license. Japanese policymakers want companies with experience running high-end integrated resorts in the Asia-Pacific region. Combined, that trio of operators run 10 gaming properties in Macau.

Who’s Left in Yokohama

Among the well-known gaming firms that previously declared interest in Yokohama that appear to still be in the mix are Genting Singapore and Melco Resorts & Entertainment. However, Genting is no sure bet to continue that pursuit.

“As part of the group’s geographical diversification strategy, the group is keenly exploring the Yokohama integrated resort opportunity in Japan,” according to a regulatory filing issued by the company last November. “We will evaluate the conditions for the Request-for-Proposal (RFP) and the investment environment when the formal bidding process begins and will respond with a proposal if these conditions meet the Group’s investment criteria.”

For its part, Melco recently reaffirmed its interest in Japan but also signaled it’s not married to Yokohama, either.