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TheStreet Open House

Singapore Mulls Spinning the Wheel of Fortune

Casino operators have their fingers crossed that Singapore will soon authorize large, Las Vegas-style casino gambling -- a potential mecca for Southeast Asian gamblers and vacationers.

Although the government of the island city-state made a decision on the issue last Saturday, it won't announce it until Monday, a senior minister said this week.

Last December, Singapore invited casino operators and developers to submit proposals for an "integrated resort" that would combine a casino with shopping, entertainment venues and hotels. The Cabinet has been reviewing the proposals, weighing the potential economic benefits against social costs.

A "yes" decision would set off a high-stakes battle between big casino companies to win the right to develop the single resort, which experts say would be perfectly situated to tap a huge market.

"It should be a great place to put a casino," says Donald McGhie, president of McGhie Consulting, a Reno, Nev., gaming consultancy. "There's a lot of money in Singapore. You have casinos in Macao, but Singapore is a lot closer to Indonesia, Thailand and Malaysia. Singapore has a big airport, which makes it a perfect spot. They have a lot of nice hotels there, too, so they could easily support a casino."

Currently, Singapore has small private gambling clubs with slot machines and horse racing at the venerable Turf Club, but no large casinos.

Merrill Lynch analysts Sean Monaghan and Tony Raza estimate a Singapore mega-casino would receive about $328 million annually from gamblers in neighboring countries. It would also recapture 50% to 60% of the $735 million that Singaporeans spend abroad in casinos each year. Merrill Lynch does and seeks to do business with companies covered in its research reports.

Singapore Senior Minister Goh Chok Tong, who announced that the government had reached a decision, said cabinet members had been divided on a large casino. Some members sided with social groups who fear it will stoke gambling addiction.

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