Galaxy Entertainment Group Ltd. is taking a stake in a Monaco casinos and hotels operator, as the company controlled by billionaire Lui Che-Woo expands beyond Macau amid a gambling downturn in the Chinese city.
Galaxy is buying 5 percent of the shares of Societe des Bains de Mer et du Cercle des Etrangers a Monaco (SBM) from an independent third party, the company said in an e-mailed statement Saturday. It didn’t name the seller or the sale price.
“We see it as a potential to develop a strategic long-term partnership with them,” Galaxy spokesman Peter Caveny said by telephone.
Separately, LVMH Moet Hennessy Louis Vuitton SE, the world’s largest luxury-goods maker, also said it would take a 5 percent in the Monte-Carlo based company. SBM, 69.5 percent-owned by the state of Monaco, has properties including the Casino de Monte-Carlo and the Casino Café de Paris, as well as luxury hotels, restaurants and night clubs, according to its website.
Macau’s casino revenue fell in June to the lowest in more than four years as the world’s biggest gambling hub was hurt by China’s slowing economy and a graft crackdown that deterred high rollers. Galaxy in May opened two new casinos in the Chinese city, including a major expansion to an older project which Chairman Lui had said performed weaker than expected.
Macau’s gross gaming revenue is expected to plunge 30 percent this year, according to the median estimate of 11 analysts surveyed by Bloomberg, before rebounding next year.