Las Vegas Sands $6.25B Strip Asset Sale to Fund its Asian Ventures

Las Vegas Sands $6.25B Strip Asset Sale to Fund its Asian Ventures

NYSE-listed Las Vegas Sands (LVS) sells its historic Strip assets, the Venetian, Palazzo, and Venetian Expo, for $6.25 billion. The sale effectively brings Las Vegas Sand’s two-decades-old operations in the US to an end.

Apollo Global Management bought the operating rights of these gaming units for $2.25 billion. In addition, the ownership of these real estate assets VICI Properties (NYSE:VICI)  was bought by VICI Properties for $4 billion.  

As CEO Rob Goldstein says,

“Las Vegas is continually evolving and is always able to rebound from challenging events like the pandemic and the global financial crisis.”

Perhaps this perception has led to industry talk of LVS expanding casino gaming in Texas and Florida, apart from a New York integrated resort development proposal.

However, the conclusion is that the current asset sales will now fund Sands new ventures in Asian markets.

Fund its latest Asian forays

Striking an upbeat note, the Chief Operating Officer and President, Patrick Dumont, said,

“Our commitment is to invest long-term in Asia… it includes a $1 billion reinvestment at Marina Bay Sands in Singapore and the completion of the $2.2 billion renovations of The Londoner (Macau).”  

According to the latest company announcements,

“LVS is planning $1 billion in upgrades to Marina Bay Sands in Singapore.”

Analyst Downgrade is Contradictory

The recent market downturn due to pandemics continues to haunt LVS financial performance. As late as last week, analyst firm Standard & Poor (S&P) downgraded the gaming operator from an investment-grade rating due to Macau’s slow recovery.

LVS Chinese operations were downgraded from “BB+” to a “junk territory from BBB-.”

Contradicting the downgrading, gaming analyst, Howard Jay Klien, states that LVS is experiencing better growth. The reasons for his outlook are the – stronger revenue and expenditure ratio, reduction in the losses LVS is making in Asia, and most importantly, Macau no longer has an uncertain regulatory market.

Las Vegas Sands already operates six gaming venues in Asia. Of these, five are integrated resorts in Macau. Incidentally, LVS has the most significant operator market share in Macau.

About sherlock

Sherlock Gomes loves to write and express his views on anything related to Gaming, Gambling, & Casino. He has been covering Gaming for more than two years now.