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Adelson expects good times for Sands despite downturn

29 August 2008

by Jeremiah Marquez

MACAO -- Las Vegas Sands Corp. Chairman Sheldon Adelson insisted his company would thrive despite worsening economic conditions as he marked the one-year anniversary Thursday of his $2.4 billion Venetian resort in this southern Chinese gambling city.

Since its opening, the mega-casino resort, the biggest in the world, has gotten some 24 million visitors and helped launch what Adelson envisions as a massive, concentrated resort area. Adelson is betting the Cotai Strip will become one of the world's top tourist destinations.

However, the American billionaire, whose company posted a second-quarter loss amid a weakening Las Vegas market, faces a host of challenges, from slowing global growth to fierce competition from Wynn Resorts Ltd. and others.

Adelson maintained Sands could fare well because of its focus on luring business travelers for conventions, exhibitions and other industry meetings held even during recessions.

"Our entire strategy avoids the possibility of an economic slowdown, a recession," Adelson said at The Venetian Macau.

He and other Sands executives also argued that possible stricter visa rules for mainland Chinese tourists, who make up of the majority of Macau visitors, would affect them less than their rivals. That's because company's Macau properties are less reliant on Chinese visitors than other casinos, they contended.

"The Cotai Strip is not just ... a series of integrated resorts for Chinese people only. It's for all Asians," Adelson said.

Earlier Thursday, he was on hand as Sands opened the upscale Four Seasons Macau, next to The Venetian, the latest project in Adelson's $13 billion master plan to develop Cotai. The company has about 23 percent of the gambling market in Macau, with The Venetian taking in $2.18 billion in revenue during its first 12 months.

Adelson also is building a resort in Singapore and has his sights on other countries in Asia, which executives say will soon account for 70 percent or more of company revenue. On Thursday, Adelson said he had recently met with government officials in India.

"We would like to build a Cotai Strip in India. That would not affect Macau whatsoever. The market in India with more than 1.1 billion people will justify more than one Cotai Strip," Adelson said. "If (the Indian government) wants to invite us there, we'll be happy to come in to spend between $12 billion and $14 billion."

Macau, just an hour by high-speed ferry from Hong Kong, has seen its gambling revenue grow rapidly since the government ended Hong Kong tycoon Stanley Ho's monopoly on the gambling industry after Macau was returned to Chinese rule from Portugal in 1999.

China's only city with legalized casinos, Macau has already overtaken the Las Vegas Strip in gaming revenue to become the world's most lucrative gambling center.

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