SBM is making moves expanding in Asia, and Jean-Luc Masurel, CEO of SBM commented on how the Café de Paris de Monte Carlo brand is targeting to open in Macau. He also comments on SBM strategic partnerships in a series of thoughts he shared recently with a French newspaper as follows: that when SBM decided to make a 5% stake available in 2015, there were 6 major players in the gaming, entertainment and hotel business in Asia that were worthy of consideration. Galaxy Entertainment Group, the biggest player in Macau and an organisation with more than 20.000 employees, became the partner of choice, one factor being because it was owned via a Hong Kong family with a stake greater than 50% – complementary with the way SBM is organized.
And similarly, when asked about specific expansion plans in Asia, it was reported there exists an immediate plan to open a Cafe de Paris de Monte Carlo in Macau and that Galaxy being the largest player there, placing Cafe de Paris in one of the Hotel complexes of the Galaxy Group made sense. There would be a menu with about 15 items including Monegasque and Mediterranean specialties like barbagiuan fritters, baccalà, octopus daube etc. – targeted for the end of this year in fact was the essence of the report.
And when asked about other expansion possibilities in Asia it was acknowledged there was a degree of interest by SBM in countries where Galaxy was already a player, Vietnam, Thailand, South Korea being examples was the crux of the report.
It was also revealed that the Agreement with Galaxy included sharing with SBM their plans to open up other businesses in Asia in future – including further opportunities in Macau. And so the report also noted that Jean-Luc Maserel would assess the fit of each of the SBM Hotel Brands in any of the new Galaxy complexes planned for Macau in the next three years.
And expanding on the nature of the SBM/ Galaxy alliance the essence of what he was reported to have said was that they had exchanged their networks and that SBM had invited a number of Galaxy’s premium clientele to Monte Carlo. Similarly, SBM’s clientele had invitations to Macau to Galaxy casinos.
And when asked how about Japan his comments as reported were that Japan is opening up to integrated resorts for gambling in 2018; legislation is there now to permit it. SBM would not go there without an experienced partner but with Galaxy there was one. There will be serious interest in bidding on the opportunities to set up there by the major gaming industry forces and no doubt Galaxy will be readying its position.
Reported comments about China are that there can never be a single priority; there is China but also Russia and the republics that were part of the USSR. Yes, SBM seeks to expand its Brands’ presence with prudent moves and with the right partners. Turkey and Latin America are also in SBM sights. Continuing on the theme with China and SBM’s experience with their Chinese clients in gaming in Monaco. One of the strengths of SBM is its ability to adapt to other cultures and create a welcoming ambiance. The Chinese are an example where SBM provides them with an opportunity to play Baccarat in the particular way the Chinese like to play it. So SBM put in specific training for that and there is a Chinese speaking employee.
Hotel de Paris
And questioned about Galaxy’s involvement in existing SBM projects like Hotel de Paris he is reported to have said in essence – that here are projects like Hotel de Paris that were formed before the Agreement with Galaxy, so these would continue unchanged as per the original plans; Michael Mecca of Galaxy being on the Board of SBM has a place there to have input as a Board member.
Past attempts at International Expansion
North Africa and the Middle East were in SBM’s expansion plans. SBM had two prospective partners, one for Jawhar, Marakesh in Morocco. This was a failure according to the report as SBM’s targeted partner did not have the funds in the end to commit. The other in Abu Dhabi could have succeeded. SBM went as far as creating a Beach-front resort along the lines of Monte Carlo Beach. The plan was for SBM’s partner to build a Hotel to complement the Beach Club. They did not do that so SBM exited, but with a very satisfactory financial result. So this does mean that the choice of partner in these expansions is critical to their success. SBM has high hopes for its expansion in Asia and the longer term strategic relationship with Galaxy.
Other advantages for Monaco
SBM already has seen progress in cultural initiatives. Galaxy is now involved with the Monte Carlo Ballet and they are looking at involvement with Opera, also. In addition, the expo of the Forbidden City at the Grimaldi Forum is supported by Galaxy.
Complementary shareholding’s with large strategically placed partners – is this the blueprint for international expansion? And Jean-Luc Masurel’s reported reponse was that SBM is hopeful that it will lead SBM to longer term strategic alliances and that the agreement with Galaxy is an example of that direction.