Genting's New York plan hits snag

KUALA LUMPUR (June 4): Genting group is no longer the only party New York is talking to for a planned US$4 billion (RM12.8 billion) mega convention centre that could come with a casino licence, governor Andrew Cuomo reportedly said last Friday. This is the second wall the Genting group has hit in the US within months, after a stalled casino bill in the state of Florida put its Miami casino plans on hold.

"The conversations [with Genting] haven't really worked out," Cuomo said of the non-binding talks New York entered into with Genting in January. "So a few weeks ago, we started to bring in other gaming companies," Cuomo was quoted as saying in a radio interview in New York, relating how other companies have "put options on the table that [Cuomo] didn't even think of".

Genting spokesman Stefan Friedman told Bloomberg News "the uncertainties and difficulties regarding the constitutional amendment, competitive landscape, tax rate and infrastructure support [for the New York convention centre] made any decision difficult".

Separately, Genting said it "now looks forward to working with Governor Cuomo and participating in any competition for a convention centre/casino project that the governor designs", a company spokesman was quoted as saying in an Associated Press (AP) report over the weekend.

The idea to make New York the No 1 convention site in the US with a proposed expansion at Aqueduct, was first announced when Cuomo delivered a blueprint for rebuilding New York on Jan 4 — which reportedly caught US casino giants off guard and sparked calls for a competitive process.

MGM Resorts International is among companies in the queue for the New York jackpot.

It is not immediately certain if Cuomo's public pronouncement means the preliminary non-binding agreement — entered into in January between Genting New York LLC and the New York State Urban Development Corp's business entity, Empire State Development Corp — is officially off. Both parties had initially given themselves until Nov 30 this year to enter into a binding agreement.

Announcing its 1QFY12 ended March 31 earnings on May 30, Genting Malaysia Bhd, the parent of Genting New York LLC, said the group was "working with stakeholders to bring about further development and expansion at Resorts World New York City" (referring to the convention centre project) and that operating momentum at existing operations, an electronic gaming facility built next to the Aqueduct race track in Queens, was gaining positive traction.

The roadblock in New York is yet another sign of rising competition for Genting, which is looking at cementing its name outside its home turf in Malaysia, having tasted success in Singapore.

In February, a bill that would have legalised wider gaming and fast-tracked the award of casino-resort licences in Florida was pulled at the final hour following wavering support. Genting had said it remains committed to the bay front Resorts World Miami project, and is working on a scaled down version and would continue to support the move in next year's legislative session.

This story appeared in The Edge Financial Daily on June 4, 2012.