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Wynn: Rule Changes will Advance Chinese Casino

26 February 2004

Las Vegas Sun

by Jeff Simpson

LAS VEGAS -- Recent developments make it clear that Wynn Resorts will soon begin building its Wynn Macau resort, Steve Wynn said Wednesday.

The semiautonomous enclave off the coast of China is now finalizing legislative approval of gambling rules that Wynn has said were necessary to proceed with plans to build his resort.

The rules that will allow Macau casinos to grant credit and to reduce their total taxable winnings by the amount of uncollectible casino debt are certain to be enacted, he said.

"The executive committee (of Macau's legislature) passed it out without opposition," said Wynn, who expects the rule changes to be enacted within a couple of weeks.

Wynn said Wynn Macau would cost about $520 million to $550 million, and estimated that it would open at the end of 2005 or the beginning of 2006. His $2.4 billion Wynn Las Vegas is slated to open in April 2005.

Wynn expects to get his first model of the Wynn Macau project in about two weeks.

"Without a question Steve Wynn will develop a property in Macau," Deutsche Banc casino analyst Marc Falcone said. "We view Macau as one of the greatest gaming markets in all the world."

Falcone said Wynn's Macau concession has one major underappreciated value -- the ability to offer subconcessions to other casino operators.

"The value of his concessions is not fully reflected in the value of Wynn's stock," Falcone said. "His ability to subconcession to other properties could prove to be a significant (revenue source) for Wynn Resorts."

Wynn declined to say whether he was working on any deals to use his concession to allow other operators to open a Macau casino, but in response to a question about a news report about Mandalay Resort Group's possible interest in a deal for a Wynn subconcession, Wynn said he had yet to talk to the company about it.

"The concession is an asset, because joint venture deals are always a nice thing," Wynn said, recalling profitable deals he lined up at the Monte Carlo and at what is now Borgata while at the helm of Mirage Resorts. "We're interested in (at least one) joint venture for our concession."

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