Macau Impresses Investor HoPublished July 1, 2007 by OCR Editor
Stanley Ho and Hong Kong Shun-Tak Holdings are embarking on a new investment journey, in which they will spend $939 million on Macau land. The area is assigned to become the Nova Taipa Gardens/Nova City project, which is expected to bring in millions in r
According to Hopewell's official statement, Sun-Tak is planning to pay Wu's Hopewell Holdings Ltd. a massive $626 million for a 50 percent claim on the Nova Taipa Gardens/ Nova City project in Macau. Shun-Tak will also pay approximately $313 million to Ho's private company, "Sociedade de Turismo e Diversoes de Macau", for an additional 25 percent, said the Shun-Tak spokesman Catherine Szeto.
According to Midland Realty Ltd. (a Hong Kong based property agency), the average price per square foot of land sold in Macau averaged this year at about $202, which is an increase higher than 50 percent since 2002. Partly responsible for the strangely high land value prices, is the fact hat Macau is the only city in China in which casino's are legal. However, the soaring revenues and increase in tourism brought to Macau by the gambling facilities have significantly boosted the economy.
The company will have no financial problems paying such expenses, as they are banking in on 82.2 percent increases in profit annually. Last year saw Shun-Tak earn $663.9 million, and $364.4 million in 2005. At approximately 12 cents per share, this is primarily due to company shareholders. Hong Kong based economists such as Enoch Fung, say that Macau's economy may rise up to 16.5 percent just this year.
Group Executive Chairman, Stanley Ho, has stated that "the groups' well established presence and extensive service network in the Pearl River Delta region were strengthened in the past year by the buoyant economy of Macau, where the group has significant diversified investments. During the year, the group embarked on insightful initiatives that extended its core business in promising long-term directions, with new additions in air travel and retail ventures".
This new purchase will ensure the Shun-Tak company well above 25 percent of the project, which is enough for full ownership.