Melco PBL Entertainment signs loan agreement

5 September 2007

NEW YORK -- (PRESS RELEASE) -- Melco PBL Entertainment (Macau) Limited (NASDAQ: MPEL), a developer and owner of casino gaming and entertainment resort facilities focused exclusively on the Macau market, today reported that its subsidiary Melco PBL Gaming (Macau) Limited, the holder of the sub-concession to operate casinos in Macau ("MPBL Gaming") has signed a US$1,750,000,000 Senior Facilities Agreement ("Senior Facilities Agreement") with Australia and New Zealand Banking Group Limited, Banc of America Securities Asia Limited, Barclays Capital, Citigroup Global Markets Asia Limited, Deutsche Bank AG and UBS AG Hong Kong Branch as coordinating lead arrangers, Deutsche Bank AG as facility agent and DB Trustees (Hong Kong) Limited as security agent.

The US$1,750,000,000 facilities consist of a US$1,500,000,000 term loan facility ("Term Loan Facility") and a US$250,000,000 revolving credit facility ("Revolving Credit Facility" and together with the Term Loan Facility, the "Facilities"). The proceeds of the Term Loan Facility will be used to finance the construction and development of the City of Dreams integrated casino and entertainment resort ("City of Dreams") and the proceeds of the Revolving Credit Facility will be available for contingencies associated with the City of Dreams project, together with general working capital requirements for the borrowing group. Subject to the satisfaction of customary conditions precedent to funding, the Term Loan Facility will be available for drawdown in HK$ or US$, bearing interest at HIBOR or LIBOR (respectively) plus a margin, in accordance with the Senior Facilities Agreement. MPBL Gaming will pay a commitment fee on any undrawn amount of the Facilities.

The recent adverse change in credit market conditions in the United States resulted in a restructuring of the US$2,750,000,000 commitment secured by MPBL Gaming in June 2007 into the Facilities as announced today. The Facilities provide MPBL Gaming with financing sufficient to meet the projected cost of constructing and developing the first phase of City of Dreams, which consists of substantially all of the 420,000 square foot casino and 85,000 square feet of retail space, as well as the 366-room Hard Rock Hotel and the 295-all-suite Crown Towers Hotel, Cotai. The Facilities also provide MPBL Gaming with financing for the completion of the 1,005-room Grand Hyatt Macau twin-tower hotel and the 1,700-seat Theatre of Dreams, scheduled to open in 2009.

MPEL remains firmly committed to its plan and timetable to develop an apartment hotel complex integrated into the existing footprint of City of Dreams by the end of 2009. The total cost of design, construction and fit-out of the apartment hotel complex is estimated at approximately US$353 million. MPEL will monitor fund raising market conditions in the coming months with a view to securing the appropriate additional financing for its apartment hotel development co-located at City of Dreams, and in relation to its plans for the development of a third hotel casino proposed for the Macau Peninsula.

The Term Loan Facility has a seven-year maturity and the Revolving Credit Facility has a five-year maturity or, if earlier, will mature on the date of repayment, prepayment or cancellation in full of the Term Loan Facility. The Term Loan Facility is subject to certain amortization payments commencing 36 months from the date of signing of the Senior Facilities Agreement. The Facilities will contain affirmative and negative covenants customary for financings of this type, including limitations on liens, indebtedness, investments, dividends and restricted payments, and the acquisition or sale of assets. The Facilities also require MPBL Gaming to comply with certain financial covenants, including ratios of EBITDA to interest expense and total indebtedness to EBITDA, as well as maximum capital expenditure.

The Senior Facilities Agreement contains events of default customary for financings of this type, including non-payment, breach of covenants, misrepresentation, cross default, change of control, dissolution, insolvency, bankruptcy events, material adverse change, and invalidity of any transaction documents.

The Facilities and any hedging exposure will be guaranteed by certain subsidiaries of MPEL and MPBL Gaming within a restricted group (each a "Guarantor"). Security for the Facilities and any hedging exposure include a first priority mortgage over the land where the Crown Macau Hotel Casino is located and over the land where the City of Dream is to be located, including all present and any future buildings on, and fixtures to, such land; an assignment of any land use rights under land concession agreements, leases or equivalent; as well as other customary security.

In connection with the financing transaction, MPEL's major shareholders, Melco International Development Limited and Publishing & Broadcasting Limited, have severally given an undertaking to ensure that a contingent contribution of up to a maximum aggregate amount of US$125,000,000 (equivalent to approximately HK$975,000,000) each will be provided to MPEL, to be supported by standby letters of credit, and to be used to pay contingencies (if any) associated with the construction of the City of Dreams if the facility agent has determined that there is no other available funding for completion of the project.