Macau casino operator MGM China, co-owned in part by casino mogul Stanley Ho’s daughter Pansy Ho, raised $1.5 billion from its Hong Kong initial public offering after pricing it at the top of its indicative range, triggering some concerns about lofty valuations.
Gambling revenues in the world’s largest gaming market are at record highs, dwarfing those of Las Vegas and fueling a surge in share prices of local casino operators that boosted demand for MGM China’s IPO.
But the rally may have pushed stock prices in the sector too far, reducing their appeal to some investors according to some analysts.
However, shares of Macau’s biggest casino operator SJM Holdings, which has nearly three times the revenue of MGM China, have surged nearly 52 percent so far this year. If MGM China can duplicate the success of SJM, the fears about high valuations should subside.
With the deal Pansy Ho is now worth nearly $2 billion more than her legendary casino father “king” Stanley.