Nov. 2 (Bloomberg) -- Las Vegas Sands Corp., run by casino billionaire Sheldon Adelson, may raise about $2.5 billion in Hong Kong this year to restart construction of stalled projects and repay debt, according to a document e-mailed to investors.

The operator follows Wynn Resorts Ltd. in selling a stake in its Macau unit to boost capital as revenue at its Las Vegas business declines. The initial public offering by Sands China Ltd., which would be the biggest in Hong Kong this year, comes after a slump in shares of gambling companies listed in the city.

“It will definitely test the market’s appetite,” Binay Chandgothia, who manages about $2 billion as chief investment officer at Principal Global Investors (Hong Kong), said by phone today. “Globally, we are passing through a period of uncertainty while we’ve seen some pullback recently on talk about restrictions on Chinese visits to Macau.”

Sands China has the second-biggest market share after SJM Holdings Ltd. in Macau, the world’s No. 1 gambling hub. Wynn Macau Ltd., whose parent is controlled by billionaire Stephen Wynn, has dropped 5.2 percent in Hong Kong trading since Oct. 15, when officials of southern China’s Guangdong province said its residents can visit Macau once every two months, a policy that hasn’t changed since last year.

Wynn said on Sept. 23 that China had eased travel restrictions to Macau to once a month. China accounts for more than half of visitors to Macau, the only place in the country where casinos are legal.

Wynn Shares Decline

Wynn Macau fell 0.7 percent to close at HK$9.90 today in Hong Kong, 1.8 percent below its IPO price. The company last month raised $1.87 billion by selling 25 percent of its business in Macau. The benchmark Hang Seng Index dropped 0.6 percent.

The Bloomberg/Standard Newspaper Macau Gambling Index, which tracks 22 gaming-related stocks, slumped 9.5 percent in October. In September, it climbed 11 percent as casino revenue rose and the Macau government imposed a cap on junket commissions.

Sands’ share sale may be 25 percent bigger than what President Michael Leven said the company might raise in July. Pricing of the shares will be fixed on Nov. 19 and trading may start Nov. 30, according to two e-mails sent to investors today.

The company is selling an unspecified number of shares equivalent to a 15 percent stake in its business in Macau, according to another document sent to investors. It plans to use the funds to repay loans, the documents said.

Cotai Strip

Sands would also use the proceeds to fund completion of buildings at its Cotai Strip project, according to the e-mails.

Adelson, the company’s chief executive officer, stopped construction on the two-thirds-built structures last year as credit markets froze, revenue growth slowed and the risk of loan defaults swelled.

The hotels, in what are referred to as parcels 5 and 6 in the Cotai Strip, will carry the St. Regis, Shangri-La, Traders and Sheraton brands. The unfinished buildings are across the street from Sands’ Venetian Macao casino resort and next to Melco Crown Entertainment Ltd.’s City of Dreams.

Sands is seeking as much as $2 billion to restart the mothballed projects, Leven said in an Oct. 23 interview.

Buddy Lam, a spokesman at Venetian Macao, Las Vegas Sands’ flagship property in Macau, wasn’t available for comment today.

To contact the reporters on this story: Chia-Peck Wong in Hong Kong at cpwong@bloomberg.net; Bei Hu in Hong Kong at bhu5@bloomberg.net

Last Updated: November 2, 2009 04:02 EST