When someone shares with you something of value, you have an obligation to share it with others.
Friday, 2 October 2009
Wynn Is Said to Raise $1.63 Billion for Macao Unit
The Las Vegas casino company Wynn Resorts raised $1.63 billion after pricing its Asian initial public offering at the top of its indicated range Wednesday, a sign that demand was still strong for certain offerings despite a glut of stock deals.
Wynn Is Said to Raise $1.63 Billion for Macao Unit
REUTERS 01 October 2009
HONG KONG — The Las Vegas casino company Wynn Resorts raised $1.63 billion after pricing its Asian initial public offering at the top of its indicated range Wednesday, a sign that demand was still strong for certain offerings despite a glut of stock deals.
The Wynn Macao division now faces the challenge of its trading debut, expected Oct. 9 on the Hong Kong exchange, where several new listings have been battered by increasingly selective investors.
Wynn Macao sold 1.25 billion shares at 10.08 Hong Kong dollars each, or $1.30, according to two people with direct knowledge of the deal. They asked to remain anonymous because they were not authorized to speak publicly about it.
The offering’s range had been 8.52 to 10.08 dollars, with Wynn selling 25 percent of the business to the public.
Some brokers said the high price might make a strong debut more difficult for Wynn.
“The valuations are really high, and market sentiment is not that good now,” said Conita Hung, head of equity research for Delta Asia Financial Group. “I don’t expect this to be a good one.”
Wynn Macao’s estimated 2010 enterprise value is about 16 times earnings before interest, taxes, depreciation and amortization, according to Gabriel Chan, a Credit Suisse analyst, placing it within the normal range of the Macao gambling sector.
It is much higher, though, than the 7.5 ratio for SJM Holdings, flagship of the Macao gambling tycoon Stanley Ho, the analyst said.
The dismal debut last week of Metallurgical Corp. of China, a building and engineering company, has weighed heavily on investors’ sentiment for new share offerings in Hong Kong.
“M.C.C. had set its price at the middle of its range, but it still fell below the issue price,” said Linus Yip, a strategist at First Shanghai Securities. “Valuations for Wynn are definitely still a concern.”
Wynn’s successful sale also puts pressure on its archrival, Las Vegas Sands, which plans to raise billions of dollars through a public offering in Hong Kong at the end of November or early December.
The Wynn Macao offer is especially important, given the deal’s potential effect on the company’s flagship Las Vegas operations. Wynn is hoping a high valuation through the Hong Kong listing will lift valuations at its other divisions.
U.S. casino operators, grappling with high debt levels and a poor economy, are hoping to lift valuations through spinoffs in Macao. The former Portuguese territory is the gambling hub of China and has the world’s biggest gambling market, having raked in record revenue in August.
JPMorgan, Morgan Stanley and UBS are joint sponsors and global coordinators of the Wynn deal, with Bank of America Merrill Lynch and Deutsche Bank as joint book runners.
1 comment:
Wynn Is Said to Raise $1.63 Billion for Macao Unit
REUTERS
01 October 2009
HONG KONG — The Las Vegas casino company Wynn Resorts raised $1.63 billion after pricing its Asian initial public offering at the top of its indicated range Wednesday, a sign that demand was still strong for certain offerings despite a glut of stock deals.
The Wynn Macao division now faces the challenge of its trading debut, expected Oct. 9 on the Hong Kong exchange, where several new listings have been battered by increasingly selective investors.
Wynn Macao sold 1.25 billion shares at 10.08 Hong Kong dollars each, or $1.30, according to two people with direct knowledge of the deal. They asked to remain anonymous because they were not authorized to speak publicly about it.
The offering’s range had been 8.52 to 10.08 dollars, with Wynn selling 25 percent of the business to the public.
Some brokers said the high price might make a strong debut more difficult for Wynn.
“The valuations are really high, and market sentiment is not that good now,” said Conita Hung, head of equity research for Delta Asia Financial Group. “I don’t expect this to be a good one.”
Wynn Macao’s estimated 2010 enterprise value is about 16 times earnings before interest, taxes, depreciation and amortization, according to Gabriel Chan, a Credit Suisse analyst, placing it within the normal range of the Macao gambling sector.
It is much higher, though, than the 7.5 ratio for SJM Holdings, flagship of the Macao gambling tycoon Stanley Ho, the analyst said.
The dismal debut last week of Metallurgical Corp. of China, a building and engineering company, has weighed heavily on investors’ sentiment for new share offerings in Hong Kong.
“M.C.C. had set its price at the middle of its range, but it still fell below the issue price,” said Linus Yip, a strategist at First Shanghai Securities. “Valuations for Wynn are definitely still a concern.”
Wynn’s successful sale also puts pressure on its archrival, Las Vegas Sands, which plans to raise billions of dollars through a public offering in Hong Kong at the end of November or early December.
The Wynn Macao offer is especially important, given the deal’s potential effect on the company’s flagship Las Vegas operations. Wynn is hoping a high valuation through the Hong Kong listing will lift valuations at its other divisions.
U.S. casino operators, grappling with high debt levels and a poor economy, are hoping to lift valuations through spinoffs in Macao. The former Portuguese territory is the gambling hub of China and has the world’s biggest gambling market, having raked in record revenue in August.
JPMorgan, Morgan Stanley and UBS are joint sponsors and global coordinators of the Wynn deal, with Bank of America Merrill Lynch and Deutsche Bank as joint book runners.
Post a Comment