Genting to fund 2/3rds of Singapore casino via debt

By Sebastian Tong

SINGAPORE (Reuters) - Malaysia’s Genting Bhd. said on Monday it would finance two-thirds of its S$5.2 billion (1.7 billion pound) casino project using bank loans.

The company said in a statement the remaining one third would be funded through equity.

The conglomerate, bidding through affiliates Genting International and cruise operator Star Cruises Ltd. <0678.HK>, on Friday secured a 30-year concession to run a casino on Singapore’s resort island of Sentosa.

The 49-hectare project would include movie-based roller-coaster rides built by theme parks giant Universal Studios and would have six hotels with a total of 1,830 rooms.

The casino, set to open by early 2010, is the second of two planned gaming resorts that Singapore hopes will almost double tourist arrivals to 17 million people and triple tourism receipts to S$30 billion ($19 billion) by 2015, giving its trade-dependent economy a new source of growth.

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Following Friday’s announcement that Genting had won, ratings agency Moody’s Investors Service affirmed the company’s A3 ratings and said the outlook was stable.

Moody’s analyst Kaven Tsang said that while the new casino project would raise Genting’s exposure to development and execution risks as well as capital needs in the medium term, it would also strengthen the company’s regional coverage and competitive position.

"Moody’s believes that the increased risk profile is manageable in view of Genting’s track record," Tsang added.

In May, U.S. gaming giant Las Vegas Sands won the bid for Singapore’s first casino resort along its downtown waterfront. That one is expected to cost more than $3.2 billion, and is set to open by late 2009 or early 2010.

2009 Reuters Click for restrictions