BRANSON - TABCORP PARTNERSHIP DEAL OFF

23 February 2007

No reasons given, but Virgin boss said to be looking elsewhere in $3 billion project

Unidentified sources have told Reuters, Agence France Presse and the English-language daily, South China Morning Post that the putative partnership between Sir Richard Branson of the Virgin Group and Australia's Tabcorp group has collapsed.

The partnership (see previous InfoPowa reports) was said to be worth $3 billion in a joint venture to open a casino in the southern Chinese boomtown Macau. "We can't see that partnership going anywhere," an unidentified source told the South China Morning Post English-language daily. "These things happen all the time," the source said, adding discussions had only been in the early stages.

Virgin boss Richard Branson had been tipped to join with Tabcorp on the US$3.0bn project after he visited the city last month with the Australian gambling outfit's Matthew Slater.

The casino is believed to have been planned for the emerging Cotai Strip, a glitzy new gaming district being built on a 100 000 square metre land reclamation that is expected to see the former Portuguese enclave leapfrog Las Vegas as the world's biggest gambling draw. Tabcorp had expected to play a major role in developing and operating the project, which would have retained the Virgin brand.

Already Macau's handful of casinos pull in more cash than their counterparts on Las Vegas' famous strip - almost $7.0 billion last year.

Virgin reportedly wants to cash in on a loophole that allows foreign operators to run casinos without a licence in Macau, the report said, adding that Branson is now looking for new partners.

Both Tabcorp and Virgin declined to comment.

Sources said last month that Virgin and Tabcorp were in talks on the casino project.

The only place in gambling-mad China where casinos are legal, Macau opened its doors to international gaming firms such as Las Vegas Sands and Wynn Resorts when a gaming monopoly held by casino mogul Stanley Ho Hung-sun expired in 2002.

Gaming revenues in the mainland enclave have climbed in the past four years, surging 23 percent in 2006 to US$7 billion to overtake the US$6.69 billion of "gaming wins" notched up by the Las Vegas Strip.

With six new casinos scheduled to open this year, the hype surrounding Macau shows no sign of abating, and media reports suggest that Stanley Ho will be strongly competing for business.

Online Casino News courtesy of InfoPowa

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