Ho still rules roost in Macau

The 88-year-old billionaire owns casinos that international law enforcement authorities have said are havens for Chinese organized crime triads. Ho might not even be able to get past the front doors of the Gaming Control Board offices.

But in the Chinese gaming enclave, Ho is the kingpin.

Despite the emergence of competition from Las Vegas Sands Corp., Wynn Resorts Ltd. and MGM Resorts International in the past decade, Ho’s 18-property casino operation continues to flourish.

In the first six months of 2010, Ho’s SJM Holdings, which is publicly traded on the Hong Kong Stock Exchange, reported a profit of $104 million, four times larger than the profit the company reported for the same six months of 2009.

Macau’s total gaming revenues are up more than 67 percent through July, which has kept Wynn Resorts and Las Vegas Sands afloat while the company’s Strip casinos struggled. SJM operates only in Macau.

Ho’s casinos run the gamut from smoky slot machine parlors to the flagship Grand Lisboa, a 500-room resort that was built in the shape of a giant lotus flower.

Ho’s properties don’t have grandeur and opulence of the Wynn casinos or the size and magnitude of Las Vegas Sands’ integrated resorts.

What they have is market share.

SJM controls about 32 percent of Macau’s gaming revenues. Las Vegas Sands has approximately 30 percent while Wynn is up to nearly 16 percent. The MGM Grand Macau is in single digits.

At the Grand Lisboa, high-end revenues grew 96 percent in the first half of the year. Revenues also grew at SJM’s smaller casinos. The revenue increase came despite the April opening of Wynn’s Encore.

Ho had a monopoly on Macau gaming for almost 40 years before the Chinese government took over the Portuguese colony and let American casino operators enter the market. He is considered one of the world’s richest men by Forbes magazine, although his stature has fallen from 84th in 2006 to 701st in 2009.

American gaming enterprises and two of Ho’s reported 17 children have cut into his Macau dominance. Daughter Pansy Ho owns half of the MGM Grand. Son Lawrence Ho is the CEO of Melco Crown Entertainment.

Last year, Stanley Ho suffered an undisclosed health issue that hospitalized him for months. It also brought up the question of succession for the businessman, who turns 89 in November.

“There is capable management in place running SJM,” Union Gaming Group principal Bill Lerner said.

Howard Stutz’s Inside Gaming column appears Sundays. He can be reached at hstutz@reviewjournal.com or 702-477-3871. He blogs at lvrj.com/blogs/stutz.