MGM Macau Deal Gets Prelim OK

A proposed partnership between MGM Mirage Inc. and Pansy Ho, the daughter of Hong Kong billionaire and casino magnate Stanley Ho, received an initial approval despite concerns from the Nevada Gaming Commission over the elder Ho’s suspected ties to organized crime.

Pansy Ho and MGM Mirage are proposing to develop a $1.1 billion casino in the Chinese tourist enclave of Macau, and she insists her business is independent of her father’s influence.

"For almost all of the 40-some years of my life, I have been trying to find an open forum to find and to express that I believe I have the capabilities to be an independent person and also to obtain independent success," Pansy Ho said. "I think the MGM opportunity will give me the chance to prove that further."

Nevada gambling authorities have spent more than two years investigating her background, however, because of lingering suspicions her father had ties to the organized crime gangs that allegedly ran VIP gambling rooms in his Macau casinos when the territory was still under Portuguese control.

After some five hours of testimony and questions that delved into the source of income for Pansy and her sister Daisy and numerous interests in other Macau business ventures with her father, the three-member board gave its unanimous approval.

Its recommendation must be confirmed by the Nevada Gaming Commission, which is expected to meet in about a month.

The Mississippi Gaming Commission approved the alliance between MGM and Pansy Ho in February 2005. The New Jersey Attorney General’s Division of Gaming Enforcement is also looking into the arrangement.

MGM sought out Pansy as a partner for her local market expertise and also as the key link to buying a vital casino subconcession right from Stanley Ho’s company, Sociedad de Jogos de Macau, or SJM, for $200 million. After that transaction, the partners were able to sever official ties to SJM.

Stanley Ho, 85, continues to dominate in Macau, where he held a gambling monopoly for four decades until liberalization in 2002. His business empire controls land, hotels, 17 casinos, and a helicopter and ferry service that keeps visitors coming. Forbes magazine estimated his wealth at $6.5 billion, making him the world’s 84th richest person.

The recommendation paves the way for MGM to join its Las Vegas-based competitors, Las Vegas Sands Corp. and Wynn Resorts Ltd., which opened resorts in Macau in 2004 and last year respectively, and plan to open more. MGM has said it is already in talks to build its second casino in Macau.