Genting gets nod for US$4b Vietnam resort

KUALA LUMPUR: Tan Sri Lim Kok Thay's Genting Group and partner VinaCapital have the Vietnamese government's permission to reclaim 1,555ha of land in the Thang Binh district, paving the way for a US$4 billion (RM12 billion) recreational resort project with gambling facilities for foreigners, said a Vietnam news report.

Genting and its partner have 12 months to reclaim the area — located within the Chu Lai Open Economic Zone, about 70km south of Hoi An city — or risk losing the project site, according to a VietNamNet report dated July 19, quoting deputy director of Chu Lai Economic Zone Management Authority, Nguyen Van Lua.

The project, which was reportedly granted an investment certificate last December, will also house five-star hotels, resort villas as well as up to 2,500 houses for sale or rent, the news report said, citing information from the Quang Nam People's Committee. Only foreign passport holders are allowed into casinos in Vietnam currently due to concerns over potential social ills.

The report didn't mention which of the Genting entities will be involved in this project. However, on Dec 21 last year, Genting Malaysia Bhd said it had been collaborating with a partner to explore leisure, hospitality and entertainment opportunities in Vietnam and would make the necessary announcements upon execution of definitive agreements. This was in reply to a Bursa Malaysia query following a report in The Edge weekly which highlighted a tie-up between Genting and local fund manager VinaCapital to develop a US$4 billion casino resort project in Hoi An city.

Some US$15 million has been transferred to provincial Vietnamese authorities for site clearance and resettlement work thus far, according to the July 19 VietNamNet report, which said Genting and VinaCapital will be pumping US$4 billion into the project.

Recognised as a Unesco World Heritage site in 1999, Hoi An city was the largest harbour in Southeast Asia in the first century. Today the quaint town attracts tourists owing to its traditional architecture with buildings that display a blend of local and foreign influence, while the serious shipping business has moved to Da Nang about 30km away.

It is not immediately certain how Genting and VinaCapital plan to position their casino resort. By train, the nearest town, Danang, is about 935km away from Ho Chi Minh City that currently attracts most of the country's five million tourists. Just some 129km southeast of Ho Chi Minh City, MGM Resorts International Ltd and Pinnacle Entertainment Inc are among casino giants currently developing the Ho Tram Strip that's fashioned after the Las Vegas Strip and is reportedly scheduled to open in phases from 2013.

Founded in 2003, VinaCapital Group is a leading investment management and real estate development firm focused on Vietnam, with a diversified portfolio of almost US$2 billion in assets under management, according to its website.

VinaCapital Investment Management Ltd, which manages three closed-end funds traded on the London Stock Exchange's AIM Market, had a US$1.7 billion combined net asset value as at December 2010.

Genting Bhd fell 12 sen or 1.13% to RM10.50 while its unit Genting Malaysia rose eight sen or 2.21% to RM3.70 on Wednesday.