Macau’s two biggest American casinos operators are making plans for share sales in Hong Kong, as detailed in my Asia Times report. Analysts are divided on whether the Macau operations of Las Vegas Sands, owner of the Venetian Macao, and Wynn Resorts are worth a gamble. Before placing their bets, investors might also want to consider the leaders of these two companies.
Wynn founder Steve Wynn and LVS chairman Sheldon Adelson are both self-made multi-millionaires. They also share an apparent conviction that success bestows skills beyond their fields of apparent expertise.
Adelson fancies himself as a master of repartee. During LVS’s earnings conference call, according to the transcript from www.AlphaRising.com, one analyst trying to discuss that possible stock offering (or IPO for initial public offering) prompted the following exchange:
Analyst: What is the earliest you think you can do something in Hong Kong?
Adelson: What do you mean do something in Hong Kong? You mean go to have dinner there?
Analyst: Well, you will probably do that pretty soon. You probably…
Adelson: We have great Chinese restaurants…
Adelson loves showing off his conviction that he’s the cleverest guy in the room. In BBC interview just after LVS’s close escape from bankruptcy last year, reporter Sharanjit Leyl asked about financing the Marina Bay Sands in Singapore, the most expensive casino resort ever built, price estimates reaching US$8 billion. Adelson brushed aside the inquiries. When Leyl rephrased the question to ask about his “problem with money,” a visibly annoyed Adelson replied, “I don’t have a problem with money. We don’t have any arguments, any confrontations. Money and I get along very well.”
Steve Wynn wouldn’t talk about his company’s IPO filing during his conference call with analysts last month, but he opted to play talk radio demagogue. “Right now we are watching the United States government deal with complex problems that clearly seem to be beyond their intellectual ability,” Wynn said. “Right now, we are more afraid of Washington than we are of the economy.”
Denouncing “bombastic rhetoric from the White House and from the administration,” Wynn said, “There is an attitude that, there is a very definite bias in this administration that business is bad… The President of the United States has his own office and he has his own group of little cadre of people that agree with him and look at the world just the way he does and they don’t listen to anybody from what I’ve heard from my business friends. They invite people down to Washington and tell them what they think, they don’t ask or listen to anybody.”
In this conference call meant to discuss company earnings and business prospects, Wynn went on to praise China – “maybe we could all learn a lesson by watching what happens there…. but I’ll bet you that government sees to it that economy and that workforce is protected” – and Macau’s incoming Chief Executive Fernando Chui Sai-on, who was chosen to run unopposed in a backroom deal and endorsed by the 300 electors (also chosen in an unopposed election) voting for Macua’s leader in the local Beijing-approved version of democracy.
Chui is a member of the cabal of families that have dominated Macau for generations. His candidacy sparked outrage among grassroots Macau, including a protest ad that had to be run in Hong Kong newspaper because no Macau publication would dare risk the wrath of the entrenched elite.
From Macau’s handover to China in December 1999 until this May, Chui served secretary for social and cultural affairs, reportedly using his position to enrich family business interests. Chui undeniably did little to improve Macau dismal social services, most notably healthcare, Chui’s area of academic training including a US PhD, despite Macau’s vast government surpluses thanks to the casino boom. People in Macau at best see Chui as an empty suit fronting for big business interests (which, given a chance to do it again, would have never let Wynn or Adelson into Macau), more commonly as a not particularly smart or honest empty suit.
But for Steve Wynn, Chui is a heroic figure. Contrasting Chui with the US leadership, Wynn praised Chui for “understanding issues that affect people” as well as exemplifying the “the level of education and sophistication that permeates the Chinese, the People’s Republic of China government.
“These are very smart people, very highly educated people, very thoughtful people. My own feeling is the government of Macau will protect and so will the central government in Beijing and the regional government in Zhuhai at Guangdong province, Guangzhou. The government will do a very enlightened and thoughtful job of protecting the interest of the citizens and the business enterprises that support the health of those businesses.”
Yet, no matter how lavish their praise for China’s government, Wynn and other international investors in China never get around to trading in their passports for Chinese citizenship.
Totally globalized native New Yorker and former broadcast news producer Muhammad Cohen is author of Hong Kong On Air, a novel set in his adopted hometown during the 1997 handover about television news, love, betrayal, financial crisis, and cheap lingerie.