MGM Resorts opens $3.4 billion casino in Macau as revenues boom

MGM Resorts opened its $3.4 billion casino resort in the Chinese-controlled territory of Macau on Tuesday, just days ahead of the Lunar New Year holiday, hoping to ride a boom in business in the world's biggest gaming hub.

MGM Cotai, which will more than triple the number of MGM's hotel rooms in the former Portuguese colony to 1,972, marks a major expansion in non-gaming attractions amid uncertainty over the renewal process of its casino license that expires in two years.

The new resort, MGM's second and the biggest investment in Macau, boasts a 2,000-seat theater and artwork including 28 carpets from the Qing dynasty as well as a four-storey atrium garden space that features digital art. It also increases MGM's overall gaming table count in the hub by 29 percent to 552.

The opening comes at a time of surging casino revenues. Macau's January numbers stormed past expectations with a 36 percent year-on-year jump, the 18th gain in a row, on demand from big whale gamblers and mom-and-pop mass punters.

The Chinese new year holiday which starts on Friday is expected to be very strong, Grant Bowie, chief executive of MGM China, the company's Macau unit, told a news conference.

"Based on the numbers we are seeing, the reservations we have got, it was very important for us to open before."

MGM is one of six licensed casino operators in the special administrative region located on the heel of China's southern coast - the only place in the country where citizens are allowed to gamble legally.

But MGM's license is due to expire in 2020 along with SJM Holdings, while licenses for Sands China, Wynn Macau, Galaxy Entertainment and Melco Resorts are set to expire in 2022.

Macau authorities have provided little information about whether, and how, the licenses will be renewed.

Bowie said the opening was vital for the concession renewal process.

"Concession renewals will be determined on diversifying Macau into more than just a gaming town," he told a news conference.

Ahead of the expirations, operators including MGM have tried to diversify into non-gaming offerings to pacify Beijing which has been increasingly wary of Macau's acute reliance on gambling, which accounts for more than 80 percent of its revenues.

MGM Cotai will open with around 177 mass gaming tables, according to analysts, with VIP gaming mostly handled by middlemen junkets set to launch by the end of the second quarter along with the resort's luxury mansion villas.

(Reporting by Farah Master; Editing by Himani Sarkar and Edwina Gibbs)