Bally’s (NYSE:BALY) stunned the gaming world Wednesday, saying it wants to bring an integrated resort to the Japanese city of Fukuoka and is hopeful the country will eventually consider future bids for gaming venues.
Japan’s long-winding efforts to lure casino companies currently revolve around three initial licenses with Nagasaki, Osaka, and Wakayama expected to submit proposals late next month. A consortium including MGM Resorts International is forecast to win in Osaka, as it’s the only bidder there, and Caesars Entertainment is part of a group seeking to bring an integrated resort to Wakayama.
Bally’s declaration is surprising because Fukuoka — Japan’s sixth-largest city — hasn’t been viewed as a contender for an integrated. In fact, Mayor Soichiro Takashima recently said he’s not interested in a gaming property coming to the area. Bally’s appears undaunted.
Fukuoka has tremendous potential as a host community for an integrated resort,” said Vice President Christopher Jewett at a press briefing.
Rhode Island-based Bally’s said it would spend $3.9 billion on Japanese gaming venue — easily the operator’s largest project to date.
Bally’s Optimistic About More Bids
Japan’s deadline for integrated resort bids is April 28. But Jewett expressed optimism that after policymakers absorb the initial batch of plans, it’s possible they reopen the field to other contenders.
It remains to be seen if that outlook proves accurate. But Prime Minister Fumio Kishida is supportive of casino gaming as an avenue for boosting tourism to the world’s largest third-largest economy. However, that’s not a guarantee Japan will rapidly expand beyond the initial three licenses it planned to award, or if it will even permit three casinos to start.
Bally’s believes that if Japanese lawmakers decide to award more gaming permits, or if they’re not enthusiastic about one of the three aforementioned cities, Fukuoka could potentially benefit.
“If this happens, Fukuoka has the potential to position itself as a strong candidate for selection,” said Jewett at the press conference. “It is clear, however, that no proposal is possible without the strong support of the many constituents in the community.”
Bold Move for Bally’s
Bally’s currently operates 14 casinos in 10 states, most of which are in regional markets, and the Japan effort is the first sign the company is thinking on an international level.
To date, the operator’s biggest deal is the $2.7 billion acquisition of Gamesys, which was wrapped up last year. Additionally, the $3.9 billion the company is proposing to spend in Japan is more than double its market capitalization of $1.57 billion, and nearly twice the price tag on a pending takeover offer by hedge fund Standard General.
Jewett didn’t mention how Bally’s would raise capital for a Japan project or if partners will be involved.