Orix Corp has announced that it plans to invest up to JPY 270 billion (US$2.4 billion) in the development of an integrated resort in Osaka, essentially matching the contribution of its consortium partner, MGM resorts.
Orix and MGM were selected by Osaka prefecture and city in September as their preferred operator for an IR facility on Yumeshima island, with the parties now in the process of preparing an area development plan for submission to the national government.
Orix Executive Officer Hitomaro Yano explained at a press conference last Thursday that the intention was to cover more than half of the initial IR investment – expected to be in the range of US$10 billion – via non-recourse loans. It is understood that Orix and MGM will each take on 40% of the remaining investment while various Kansai businesses currently seeking investment will contribute the other 20%. Orix expects to cover its investment with cash on hand.
Bill Hornbuckle, CEO and President of MGM Resorts International, told investors in August that his company was prepared for an initial investment of US$2.5 billion in its Osaka IR, to be funded over the course of three years from 2024.
“The program with ORIX is 40-40-20, meaning a consortium with other Japanese companies will make up the 20%. If not [MGM and ORIX] both fill to 50%,” he said.
“If we call the project US$10 billion, although we think it will be a little lower, with 55/45 debt to equity, that means for us it’s a US$2 billion to US$2.5 billion cheque, probably split between 2024, 2025 and 2026.”
MGM, Orix and Osaka city and prefecture plan to submit an area development plan by April 2022, with an opening planned for 2029.
Orix said Thursday, “Because it is a landfill site, the construction plan will be finalized after a ground survey, including work such as boring. Orix has some criteria that must be satisfied in the upcoming processes but we will continue to proceed with the project’s implementation.”
Asked about forecast returns from the IR, Orix added said its current calculations look forward “over several years considering inbound visitors, but currently we are planning for a scenario on the premise of only Japanese visitors. Some will talk about 10, 20 or any multiple of years, but the calculation is based on an IRR (internal rate of return) of at least 10%. MGM has estimated numbers double our calculations, but we are not planning for that. We will use our conservative numbers to seek Japanese investment and considering how to reach that number with only Japanese customers.”
"corp" - Google News
November 08, 2021 at 06:46AM
https://ift.tt/31Hdmeb
Orix Corp looking to match MGM Resorts with US$2.4 billion contribution to Osaka IR development - IAG - Inside Asian Gaming
"corp" - Google News
https://ift.tt/2RhVoHj
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update
Bagikan Berita Ini
0 Response to "Orix Corp looking to match MGM Resorts with US$2.4 billion contribution to Osaka IR development - IAG - Inside Asian Gaming"
Post a Comment