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SkyCity seeks expanded gambling for convention centre deal

Article – BusinessDesk

June 13 (BusinessDesk) – The government may ease gambling restrictions on SkyCity Entertainment Group if the casino operator agrees to foot the bill for a $350 million international convention centre.

SkyCity seeks expanded gambling for convention centre deal

June 13 (BusinessDesk) – The government may ease gambling restrictions on SkyCity Entertainment Group if the casino operator agrees to foot the bill for a $350 million international convention centre.

SkyCity has offered to build a 3,500 seat convention centre at its own cost, and in return, is seeking an extension to its gaming licence beyond the existing 2021 date, and more gambling tables and one-armed bandits at its Auckland operation, Acting Economic Development Minister David Carter said in a statement yesterday.

“SkyCity is prepared and able to fund the full development, estimated to be around $350 million,” chief executive Nigel Morrison said in a statement. “This is subject to reaching a satisfactory outcome from the discussions with the government to ensure that SkyCity achieves an overall acceptable return on this substantial investment.”

The Auckland casino accounts for about two-thirds of SkyCity’s operating earnings, and has been recovering momentum after a soft September quarter.

Last month, rating agency Standard & Poor’s affirmed the casino operator’s investment grade BBB-minus rating, and put it on a stable outlook, saying the company has some leeway to take on new debt for new investment.

The convention centre is projected to inject some $90 million a year to the nation’s economy, and add 800 service jobs once it’s up and running, with 1,000 jobs for the construction phase.

Prime Minister John Key welcomed the offer from SkyCity, and said any changes to gambling regulations will be subject to full public submissions.

SkyCity shares fell 1.4% to $3.46 in trading on Friday, and have gained 6.8% this year.

(BusinessDesk) 09:12:20

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