Hong Kong billionaire Stanley Ho, chairman of Macau's biggest casino operator SJM Holdings <0880.HK>, has offloaded more of his shares to relatives, the latest move to cement succession plans for his vast empire.
The share restructuring, detailed in a filing with the Hong Kong stock exchange on Monday, said the 89-year-old chairman will no longer have any attributable interest in Sociedade de Turismoe Diversoes de Macau, S.A. (STDM), which controls SJM's parent, STDM - Investments Ltd.
Under the restructuring, the 26.8 percent stake in STDM held by Ho's Lanceford Co Ltd was transferred to family-run firms Action Winner Holdings Ltd and Ranillo Investments Ltd, which together now own a 31.7 stake in STDM.
It sounds fairly consistent with what he has been doing in terms of getting his affairs in order. It's probably good if you are an SJM shareholder, because he is trying to ensure there isn't going to be a big fight after he has gone, said Philip Tulk, an analyst at RBS in Hong Kong.
New shareholders include Ho's third wife, Chan Un-chan, and five children from Ho's second wife, Lucina Laam King-ying. The share proportion has been divided with Chan getting a 50.5 percent stake and the five siblings Pansy Ho, Daisy Ho, Maisy Ho, Josie Ho and Lawrence Ho, splitting the remaining 49.5 percent.
Angela Leong, Ho's fourth wife, was appointed managing director of SJM's operating subsidiary, Sociedade de Jogos de Macau, S.A., in December, the most recent shift of power from Ho, whose frail health has triggered speculation about his succession.
Ho, who has amassed an empire worth an estimated $3 billion, was hospitalized in 2009 and confined for seven months after an accident. He also underwent two surgeries but has since made more regular public appearances.
Shares of SJM, which controls more than 30 percent of Macau's gambling market, fell as much as 9 percent after the restructuring announcement but partially recovered to close down 4 percent at HK$13.80. Shares had been suspended earlier on Monday, pending the announcement.
Shares in SJM have been trading at record highs since the start of the year, hitting an all-time peak of HK$15.04 on January 20.
Casino revenue in Macau soared 58 percent in 2010, with surging demand from the high-roller VIP segment that has grown along with China's strong domestic economy helping to sustain double-digit growth in the world's largest gambling market.
Most analysts are bullish on the outlook for Macau -- the only Chinese city where gambling is legal -- citing solid fundamentals including low penetration of the mainland market, and a strengthening of the renminbi as offsetting nagging concerns over domestic credit tightening.
SJM had a monopoly on gambling in Macau until 2002 when the territory granted new casino concessions to more operators including Wynn Resorts Ltd
(Editing by Muralikumar Anantharaman)