China’s move bad luck for Australian casino company, good luck for Macau
Sydney — When Australia sneezes, does Macau catch a cold? The territory’s casino stocks have certainly taken fright at Chinese authorities’ detention of 18 employees of Australian gambling company Crown Resorts — shares in Sands China fell as much as 5.4% and Wynn Macau dropped 4.6%. It’s understandable that the news has alarmed the industry. The Australian Financial Review quoted China’s foreign ministry as saying that the employees were being held in connection with gambling crimes. Marketing of gambling services — an essential element in attracting VIP clients, the high-rollers who make up a significant slice of Asian casino revenues — is illegal in mainland China. As a result, much of the industry operates in a gray area, winning new customers by advertising their non-gaming attractions instead, or allowing junket operators to act as middlemen. That’s actually a good reason for the Macau operators to take heart. Right now, there are two main threats to their VIP businesses — the...
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