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Free Malaysia Today
a day ago
- Business
- Free Malaysia Today
Genting Malaysia's loss-making US unit sells assets for RM2.2bil
Genting Malaysia's US$41 million (RM173 million) buyout of Empire Resorts raised eyebrows among some investors and analysts. (File pic) PETALING JAYA : Genting Malaysia Bhd's (GENM) loss-making US subsidiary Empire Resorts Inc (ERI) is disposing its non-casino properties in New York state for US$525 million (RM2.2 billion) to eliminate its debt, and purchase land. GENM said the proposal will 'deliver long-term strategic and financial benefits' to ERI as the sale proceeds enables it to fully redeem its US$300 million (RM1.3 billion) bond due in November 2026. This will make ERI – which has been recording losses for over two decades – debt-free. 'The proposal will reinforce GENM's long-term commitment to improve its competitive position within the New York state gaming market and the broader northeastern US region,' it said in a filing with Bursa Malaysia today. GENM said the restructuring will lower financing costs, boost ERI's assets and add RM42.1 million in extra cash. The deal will see ERI sell the 332-room Resorts World Catskills and the 99-room Alder Hotel, the 18-hole Monster golf course, the 2,500-seat RWC Epicenter, and restaurants to a local development body, Sullivan County Resort Facilities Local Development Corp (SCRFLDC). Part of the sale proceeds will be used to buy 1,554.6 acres of land from EPR Properties for RM848 million. EPR is a US-listed real estate investment trust (REIT) that invests in entertainment properties. The land includes 420 acres upon which Resorts World Catskills' assets sit, and 1,134.6 acres of vacant land with potential for future development. ERI will also enter into a land lease with SCRFLDC through Feb 15, 2066 for all land under the non-gaming assets, and manage the assets under a 20-year agreement, with two automatic five-year renewals. ERI and SCRFLDC are currently finalising terms for the sale, lease and management agreements. Controversial US$41 million buyout This exercise comes on the heels of GENM's controversial US$41 million (RM173 million) buyout of the remaining 51% of ERI it did not own from Kien Huat Realty III Ltd. This is the vehicle of the Lim family led by Lim Kok Thay, the son of Genting founder Lim Goh Tong. Under the deal announced some three months ago, Kien Huat Realty III assigned a US$39.7 million (RM167 million) debt to GENM that ERI owed to it. Some analysts labelled the acquisition 'expensive and potentially profit-dilutive', and concerns were raised that it was an unfavourable related party transaction (RPT). Bursa also grilled GENM over the buyout, slapping the gaming and resort operator with 20 questions on the deal. According to its 2024 annual report, Kok Thay, 73, and his son, Keong Hui, 40, have a deemed interest of 49.35% in GENM as of March 17, 2025. Kok Thay is GENM's deputy chairman and chief executive while Keong Hui is the deputy chief executive and executive director. GENM shares rose 3 sen or 1.5% to RM2.02 today, valuing the group at RM12 billion. Year to date, the stock is down 10.2%.
Malaysian Reserve
a day ago
- Business
- Malaysian Reserve
Genting's Empire Resorts unlocks RM2.2b, secures land ownership, and wipes out debt
GENTING Malaysia Bhd's (GENM) US subsidiary, Empire Resorts Inc, is making a major strategic move to strengthen its financial position and expand its landholdings in New York. Empire is set to sell its non-gaming assets including the 332-room Resorts World Catskills hotel, 99-room Alder Hotel, 18-hole Monster Golf Course, the 2,500-seat RWC Epicenter, and multiple restaurants to Sullivan County Resort Facilities Local Development Corporation (SCRFLDC) for US$525 million (around RM2.2 billion). The cash from this sale will fund a series of strategic initiatives that reshape the company's operations. Proceeds from the sale will allow Empire to buy 1,554.6 acres of land from EPR Properties for US$201.3 million (RM848.1 million), securing ownership of the resort's existing gaming and non-gaming areas and additional land for future development. Empire will also use the funds to redeem its US$300 million (RM1.3 billion) 7.75% senior unsecured notes due in November 2026, leaving the company debt-free. Empire will continue to manage the sold non-gaming assets under a 20-year agreement with SCRFLDC, while the facilities will be operated as public benefit assets aimed at promoting employment and local development in Sullivan County. The proposal is expected to deliver several long-term benefits. Redeeming the bond strengthens Empire's balance sheet and frees it from interest obligations, while owning the land outright gives the company long-term control and flexibility. Eliminating lease payments and generating surplus cash of around US$10 million (RM42.1 million) improves working capital and cost efficiency. GENM said the initiative reinforces its commitment to expanding Empire's competitiveness in the New York gaming market and the broader northeastern US region. Empire and SCRFLDC are in the process of finalising agreements, with further details to be announced in due course. –TMR
Rakyat Post
01-08-2025
- Business
- Rakyat Post
Genting Malaysia Opens 2025 Scholarship Applications, Targeting Future Industry Leaders
Subscribe to our FREE Genting Malaysia Berhad has officially launched applications for its 2025 scholarship programme, continuing the company's commitment to nurturing local talent and fulfilling corporate social responsibility. The company announced today that since its establishment in 2006, the Genting Malaysia Scholarship has supported hundreds of talented Malaysian students in their higher education pursuits. It covers Additionally, recipients are given one return flight ticket. Key application details: Deadline: 15 August 2025 Age limit: Under 23 years old Eligibility: Malaysian citizens accepted into local or international universities for full-time undergraduate programmes Application method: Online only through the official website Academic requirements (any one): STPM/A-Level: Minimum 3 A grades Diploma/Foundation: Minimum CGPA 3.0 Other recognised pre-university qualifications with equivalent results Additional criteria: Active participation in extracurricular activities Demonstrated leadership abilities Willingness for personal development Priority given to: Families with a monthly income below RM10,000 who haven't received other scholarships or financial aid Supporting Malaysian Talent Development The scholarship covers key national development areas, including: Hospitality & Tourism Management Culinary Parks & Recreation Science Finance/ Accounting Actuarial Science Mathematics Data Analytics/Statistics Economics Electrical & Electronic Engineering Information Technology Computer Science Artificial Intelligence Business/Marketing Law Human Resources Psychology Since the inception of this scholarship, Genting Malaysia Berhad have seen how access to education can open doors and create lasting change, said Lee Thiam Kit, its Deputy President. At GENM, we are proud to play a part in empowering talented young Malaysians to pursue their academic goals and build a better future for themselves and their communities. For complete eligibility requirements and details, visit: Share your thoughts with us via TRP's . Get more stories like this to your inbox by signing up for our newsletter.
BusinessToday
03-06-2025
- Business
- BusinessToday
Analysts Downgrade Genting Malaysia, After Sharp Drop In Q1 Profits
CIMB Investment Bank Bhd (CIMB Securities) has downgraded Genting Malaysia Bhd (GENM) to HOLD from Buy, with a sharply lower target price of RM1.95 from RM2.45, while Hong Leong Investment Bank (HLIB) has reiterated its HOLD call with a revised target price of RM1.82, as both research houses flagged significant earnings pressure from weaker-than-expected performance across domestic and international operations. GENM's core net profit for the first quarter of FY25 fell 78% year-on-year to RM52 million, which CIMB said was impacted by a broad-based earnings decline across Resorts World Genting (RWG), the US, and UK segments, compounded by higher net interest cost and an elevated effective tax rate. The results were well below expectations, coming in at only 9% and 8% of CIMB Securities' and consensus full-year forecasts, respectively. HLIB similarly noted that GENM's RM31.1 million core profit for the quarter missed its projection by a wide margin, at just 6% of its FY25 estimate. RWG's gross gaming revenue (GGR) was a key concern, declining 7% year-on-year and 9% quarter-on-quarter, driven mainly by a significant drop in VIP play, which fell 18% year-on-year. Although mass market GGR grew by 7%, it was not enough to offset the overall weakness. CIMB Securities highlighted that hilltop visitations dipped 2% year-on-year, likely impacted by the earlier timing of Hari Raya compared to 2024, which affected non-gaming activities. Meanwhile, EBITDA for the group fell 11% year-on-year to RM869 million, with EBITDA margins shrinking to 31.9%. In the US and Bahamas, EBITDA contracted 22% year-on-year, pressured by higher labour costs and a weaker US dollar against the ringgit. In the UK and Egypt, earnings fell 25% year-on-year under similar conditions, though they were flat quarter-on-quarter. Share of associate losses from Empire Resorts also widened sequentially. HLIB noted that while revenue in the US & Bahamas rose 8.6% quarter-on-quarter, group-wide earnings recovery was insufficient to match past performance due to structural headwinds in international markets. CIMB Securities revised its core earnings estimates down by 37–39% for FY25–27, expecting a 29% drop in FY25 earnings before a modest 12% recovery in FY26, aided by anticipated tourist inflows during Visit Malaysia Year. HLIB likewise slashed its forecasts by 36–40%, citing persistently high finance costs, tax burdens and operating volatility in the US. Despite the earnings headwinds, both brokers pointed out GENM's dividend yields remain relatively attractive at 5.5–6.6% over FY25–27. However, CIMB Securities stressed that valuation at an FY25 EV/EBITDA of 8.3x is only modestly attractive, trading at a 12% discount to its 10-year pre-COVID average. Upside risk remains in the form of a possible full casino licence in Downstate New York, which CIMB Securites estimates could add 40–50 sen to its target price. GENM shares closed at RM1.82 on 30 May, giving the group a market capitalisation of RM10.26 billion. Related
Free Malaysia Today
09-05-2025
- Business
- Free Malaysia Today
Bursa scrutinises Genting Malaysia's buyout of loss-making US unit
Some analysts said Genting Malaysia's acquisition of Empire Resorts is expensive and potentially profit-dilutive. (File pic) PETALING JAYA : Bursa Malaysia Securities Bhd has grilled Genting Malaysia Bhd (GENM) over its proposed US$41 million (RM177 million) buyout of loss-making Empire Resorts Inc (ERI) from the Genting group's founding Lim family. The bourse regulator slapped the gaming and resort operator yesterday with 20 questions on the deal, which raised eyebrows among some analysts and investors. GENM announced last Friday it is acquiring the remaining 51% stake in Genting Empire Resorts LLC (GERL) it does not currently own for US$41 million from Kien Huat Realty III Ltd, a vehicle of the Lim family led by Lim Kok Thay, the son of Genting founder Lim Goh Tong. The group currently has a 49% interest in GERL, which wholly owns ERI that has gaming properties in New York state. Under the deal, Kien Huat Realty III will also assign a US$39.7 million (RM170 million) debt to GENM that ERI owes to it. Some analysts have labelled the acquisition as expensive and potentially profit-dilutive, and will likely be a financial drag on the group. Concerns have also been raised that it is an unfavourable related party transaction (RPT). That Bursa slapped GENM with 20 questions perhaps reflects the greater scrutiny the regulator has on the transaction, which has garnered keen investor interest. It asked GENM to state the rationale for acquiring the remaining 51% in GERL given the latter had already invested substantially in the preferred stocks of ERI, which is convertible to common stocks in the company. Bursa also wanted GENM to state the justifications for the purchase consideration of US$41 million, and to justify the premium paid for the 51% interest in GERL. It sought a clarification on whether the market value range of the common stock of US$36.5 million to US$46.9 million is the market value ascribed for 100% interest in ERI. The regulator also wanted details on the liabilities and guarantee to be assumed by GENM arising from the proposed acquisition. Bursa asked the group to explain the increase in its total borrowings from RM12.22 billion to RM13.49 billion post-acquisition. In its reply, GENM said the acquisition falls within the independently assessed market value range of US$36.5 million to US$46.9 million for ERI. It added the valuation was performed by independent valuer CBRE Securities LLC on April 22, 2025. It said no additional liabilities, including contingent liabilities and guarantees, will be assumed by the company, aside from paying the purchase price. It said GERL posted a net loss of US$54.1 million for the financial year ended Dec 31, 2024 (FY2024), down from US$65.4 million in FY2023. It incurred a US$53.4 million net loss in FY2022. ERI, meanwhile, posted a lower net loss of US$53.1 million in FY2024 from US$57 million in FY2023, but higher than US$44.2 million in FY2022. GENM said ERI will concentrate on increasing gaming revenues for its Resorts World Catskills by broadening its demographic reach to key upstate markets. However, it cautioned there is no guarantee ERI will be able to maintain a positive trajectory in its financial and operational performance. GENM's investments in ERI prior to the latest acquisition totalled US$724.4 million (RM3.1 billion), after it made several capital injections through common and preferred stocks in recent years. According to its 2024 annual report, the 73-year-old Kok Thay and his son, Keong Hui, 40, have a deemed interest of 49.35% in GENM as of March 17, 2025. Kok Thay is GENM's deputy chairman and chief executive while Keong Hui is the group's deputy chief executive and executive director. In a recent note, Public Investment Bank said the deal was an 'unfavourable' RPT that suggests 'corporate governance remains a concern' for GENM. GENM's shares closed 3 sen or 1.7% higher at RM1.76, valuing the group at RM10.45 billion. Year to date, the counter has fallen 22%.
