UPDATE 2-Pachinko operator Dynam in talks to build Japan casino with Asian partner
* First bill to legalize casinos in Japan due within months
* Dynam chmn plans to announce deal after first bill passes
* Japan could become world's third-biggest gambling market (Adds names of Dynam talks partners, chairman comment)
TOKYO, April 8 (Reuters) - Pachinko hall operator Dynam Japan Holdings Co is in talks with several Asian gaming operators to build a casino in Japan as the country's parliament prepares to debate a bill that would legalise casino gambling for the first time.
Yoji Sato, Dynam's chairman and one of Japan's wealthiest businessmen, said the company wants to announce a partnership with an Asian operator once an initial bill is passed that will start the process of legalizing gambling. Analysts say Japan could become the world's third-biggest gambling market with annual revenue of over $40 billion.
Proponents of the bill expect debate to start next month, and aim to pass it before parliament session ends in June. They say casinos could be in operation by the time Tokyo stages the 2020 summer Olympic Games, boosting leisure industry spending.
Sato said Dynam has already held talks with Macau-based operators Melco Crown Entertainment Ltd, SJM Holdings Ltd and Galaxy Entertainment Group, as well as South Korea's Paradise Group and NagaCorp Ltd, which has a casino in Cambodia. His comments mark the first time a Japanese company has disclosed a short list of potential overseas partners.
Paradise said it has looked at opportunities in Japan but for now has decided not to pursue them. The other companies named by Sato weren't immediately available for comment.
Japan's pachinko industry, which involves a game that resembles a cross between slots and a pinball machine, has a huge foothold in the country where one out of six adults is said to play recreationally. Brokerage CLSA estimates Japan could become the world's biggest market for gambling after Macau and the United States, raking in revenue of at least $40 billion a year.
"Dynam's number one focus is on the casino opportunity in Japan," Sato said, speaking to Reuters via video from his office in Hong Kong, where the Japanese company listed its shares in 2012.
Sato said he would not necessarily seek majority ownership of a casino project in Japan, but would want play a leading role in operating it. If it were able to secure a license, Dynam may look to raise funds in Japan, possibly through a listing or an issuance of shares, he added.
Japan is widely viewed as a prize market for casino operators due to its wealthy population and proximity to China, home to some of the world's most prolific, and wealthiest, gamblers. Countries from the Philippines to Russia are building large-scale resorts to woo wealthy Asian gamblers.
If parliament approves the initial bill in the coming months, bureaucrats can then start working on concrete laws that would be incorporated in a second bill proponents aim to pass in 2015.
Non-Asian operators eyeing the Japanese market include Las Vegas Sands, MGM Resorts International and Wynn Resorts Ltd.
Japan is expected to open casino resorts similar to those in Singapore, like Sheldon Adelson's Marina Bay Sands and Genting's Resorts World Sentosa. Politicians in Japan are keen to attract high-roller gamblers, as well as mass-market visitors who spend on dining, entertainment and retail.
While the top global operators have for the most part focused on Tokyo and Osaka, Sato said he wanted to target regional markets outside big cities, such as potential sites in Hokkaido to the north and the southern Kyushu area.
That would match Dynam's strategy for the pachinko market. It has placed most of its 370 halls outside the city areas and has been trying to expand the number of players by offering a less expensive version of the game.
"I think the local area is better. There you can run a stable operation targeting the mass market, with high-rollers accounting for about 10 to 20 percent of your business," Sato said. (Reporting by Farah Master, Nathan Layne and Emi Emoto; Editing by Kenneth Maxwell)
- French warplanes search Mali desert for crashed Air Algerie plane |
- At least 15 killed by shelling of Gaza school; toll exceeds 760 |
- Exclusive: Ukraine rebel commander acknowledges fighters had BUK missile
- U.S. House panel votes to authorize lawsuit against Obama
- Lawyers call for outside probe of 'bungled' Arizona execution |