NagaCorp, a Cambodian casino company, has further expanded its already important monopoly on Phnom Penh gaming operations.
The Hong Kong-listed NagaCorp reported on Tuesday that it had reached an agreement with the government of Cambodia to expand its casino monopoly by another 10 years within a radius of 200 km from the nation’s capital Phnom Penh.
The initial deal with the government of Cambodia by NagaCorp gave the company a 70-year gaming licence that expired in 2065. The contract also granted a casino monopoly in and around Phnom Penh for NagaCorp — with a few regional exceptions, such as Sihanoukville and along the Vietnam border— until January 1, 2036. Tuesday’s announced deal extends the monopoly to 31 December 2045.
For its part, after signing the new deal, NagaCorp agreed to pay the government $10 m plus another $3 m per year for 10 years starting on January 1, 2036. NagaCorp said the government also took into account the ambitious –some say too ambitious–project of the company to spend $3.5b on expanding its NagaWorld resort in Phnom Penh dramatically.
NagaCorp shareholders approved the company’s Naga 3 plans in August, which envisage the construction of several very high towers that will feature a combined 4,720 hotel rooms, along with the usual assortment of integrated non-gaming resort facilities (shopping, dining, entertainment, conferences, etc.) plus a major expansion in slots and gaming tables.
NagaCorp is one of the few Asia-Pacific casino operators that have managed to avoid the chaos of recent years, consistently transforming gaming sales, earnings and profits into double-digit increases. Tuesday, the company said it expects an annual revenue increase of 10 percent by the end of 2025.
NagaCorp also expects greater regulatory stability if Cambodia fulfils its pledge to approve the long-running reform of the country’s gambling laws in 2020. Lately, the government seemed to be more focused on tracking the collapse of its once thriving online gambling market, which is expected to be shut down for good by the end of 2019.