GENTING International plc, a unit of Asia’s biggest casino operator by market value, is seeking to borrow a record S$3.2 billion to fund a casino

GENTING International plc, a unit of Asia’s biggest casino operator by market value, is seeking to borrow a record S$3.2 billion to fund a casino resort in Singapore, three people with knowledge of the transaction said.

The overseas unit of Kuala Lumpur-based Genting Bhd is adding to S$2.17 billion raised in a rights offer in August, and S$450 million of convertible bonds it sold in April to partly fund the resort.

Genting International’s loan will push lending to Asia’s casino industry to about US$9.1 billion, more than double the total for last year, according to data compiled by Bloomberg. Lending to the region’s industry is set to grow as countries including Japan consider joining Singapore in lifting bans on casinos.

‘There are quite a few countries in Asia where gambling is banned,’ said Harsh Agarwal, a credit analyst with Lehman Brothers. ‘If more countries legalise gambling, we should see an increase in bank lending for casinos.’

Las Vegas Sands, the world’s largest casino operator by market value, hired eight banks last month to arrange a loan of about S$5 billion for its Singapore gaming resort.

Genting International’s loan will be a record for the Singapore-listed company. The gaming operator has yet to pick arrangers, said the people, who declined to be identified because the information is private.

Tan Hee Teck, chief executive officer of Resorts World at Sentosa Pte, Genting International’s S$5.2 billion casino project in Singapore, didn’t return calls made to his office yesterday.

The regulated gambling market in the Asia-Pacific region is expected to expand 15.7 per cent a year to US$30.3 billion in 2011, according to PricewaterhouseCoopers. The region will replace Europe, the Middle East and Africa as the second-biggest gaming market after the US by 2011, PwC says.

Genting International will be building the casino on Sentosa island, known for its golf courses and beaches. The resort will include South-east Asia’s first Universal Studios theme park.

Singapore’s government lifted a four-decade ban on casinos two years ago and issued licences to Genting International and Las Vegas Sands.

‘Bankers will take a lot of comfort in that Genting does have a history in casinos,’ Mr Agarwal said. - Bloomberg

Source : Business Times - 24 Oct 2007