MANILA — The Philippines’ most valuable company, SM Investments Corp, is planning to invest at least $300 million in an integrated casino and resort north of Manila, two sources with knowledge of the matter said on Wednesday.
Premium Leisure, a unit of SM’s Belle Corp unit, has applied for a license to build and operate a casino and resort in Clark, a former U.S. military air base turned into a leisure and business hub, in Pampanga province, the sources said.
Shares in Belle sank minutes after the news of the expansion. They fell 7.26%, closing at a 10-week low and bucking the 0.31% gain in the broader stock market index PSI, while SM’s share price ended 2.56% higher.
“Aside from the casino, there will be a convention center and a hotel,” one of the sources told Reuters.
Premium Leisure, which delisted from the stock exchange earlier this month, is the landlord of the $1 billion-plus City of Dreams casino-resort, operated by Nasdaq-listed Melco Resorts and Entertainment, in Manila’s much-smaller version of the Las Vegas gaming strip.
Officials of SM, Belle and Premium Leisure did not immediately respond to requests for comment.
SM, with a market value of $18.8 billion, has interests that range across shopping malls, banking, residential and office towers, retail, mining and logistics.
SM’s expansion may boost the planned initial public offering (IPO) of another Clark casino operator, said Juan Paolo Colet, managing director at investment bank China Bank Capital in Manila.
Hann Resort, which operates a casino-resort with 147 gaming tables and 868 slot machines in Clark, is planning for IPO of up to 20 billion pesos ($342.2 million) early next year, the chief of the gaming regulator said on Tuesday.
“Clark is emerging as a promising growth market for gaming and leisure. It could become the next major integrated resort hub,” Colet said.
The Philippine gambling sector, next only in size to Macau and Singapore in Asia, attracts high rollers from countries like China, Japan and South Korea. It has enticed foreign and domestic firms to set up billion-dollar integrated casino-resorts, creating thousands of jobs.
— Reporting by Neil Jerome Morales; Editing by John Mair and Arun Koyyur
