Melco Now Own 75% of Cyprus Casino Project

If all goes well, the Mediterranean island of Cyprus should open Europe’s first integrated casino resort by 2019. The project is expected to cost more than €500 million to complete, and was initially offered to Hard Rock International before the company sold its stake to Melco International this summer.
This week, the Hong Kong-listed casino firm has subsequently increased its holding by a further 4%, bringing its overall share in the project to 75%. The other partner in the development, Cyprus Phasouri (Zakaki) Ltd, owns the remaining 25%, and is responsible for providing the real estate upon which the casino resort will be sited.
The announcement was made as part of a corporate exercise currently taking place that is expected to be concluded by the end of this year. Also included in the shareholders’ agreement is Melco International reserving the right to choose the casino project company’s chairman, as well as a further four directors out of a board of six. Laying out some of its other areas of authority, the Melco filing lodged on Monday stated that the management services would be responsible for:
“..the design, construction and development process for the [project], pre-opening and related services, corporate management services and the provision of intellectual property and proprietary systems.”
Mention was also made of the “unique” and “attractive” opportunity offered by the Cyprus venture, and that partnering with a strong local partner like Cyprus Phasouri should prove a highly beneficial arrangement for the development project.
As part of its contract, Melco International has been granted a 30-year casino licence from the government of Cyprus, with 15 years of exclusivity before competing licences might potentially be issued to other operators. In addition to its main integrated casino resort, Melco International and Cyprus Phasouri will also be permitted to construct a satellite casino and three slot parlours in the Republic of Cyprus.
Once complete, the casino resort is expected to generate in excess of €100 million per year, and provide employment for at least 2,400 people. Explaining some of its other benefits, Finance Minister Harris Georgiades stated:
“The indirect benefit to the economy would also be big. It will add another chain in the economy as all sectors would benefit. There would be more tourist arrivals, gains from catering, transport and food.”