HONG KONG (Reuters) — Macao’s government said on Thursday global gaming operators can submit bids for new licenses from July 29 until Sept. 14, kicking off a highly anticipated process to secure a spot in the world’s biggest casino hub.
The licenses of the six current operators Sands China, Wynn Macau, MGM China, Galaxy Entertainment, SJM Holdings and Melco Resorts expire at the end of the year.
They must bid for new licenses to remain in the Chinese special administrative region alongside new players also vying to operate.
The rebidding takes place amid Macao’s worst outbreak of COVID-19, which led to a 12-day closure of casinos in July and, while they have reopened for staff to return to work, there is no business as restrictions are only being lifted slowly.
Companies must provide a guarantee of not less than 10 million patacas ($1.24 million) and submit the required qualification documents, the government said, according to a statement on its website.
When bidding, “special consideration should be given to develop foreign tourist markets, experience in operating casino games, investment in gaming and non gaming projects for Macao’s benefit, plans to manage the casino, plans to monitor and prevent illegal activities and social responsibilities.”
Macao’s government set up a committee to vet bidders for the new licenses, with a decision expected in the fourth quarter.
Failure to secure new contracts, set to begin in 2023, means current operators will be banned from operating casinos on which they depend for their business and in which they have invested billions over the past two decades.
At a time when other gambling centers in the world are getting busy again, Macao’s COVID-19 curbs are burning through about $600 million each month. The casinos are expected to have little to no income for months, analysts say.
The sector had already been reeling since the start of the pandemic, with revenues sliding 70% in 2021 to $10.8 billion from $36 billion in 2019.
But the prospect of not being able to operate in future is more daunting than what casinos hope will be a short-term liquidity shortage.