Macau : Stanley Ho Says Family Members Seize Gambling Empire Stake

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Stanley Ho Says Family Members Seize Gambling Empire Stake
William Mellor and Debra Mao
Jan 25, 2011


Stanley Ho, managing director of Sociedade de Jogos de Macau SA.
Photographer: Jerome Favre/Bloomberg

Macau billionaire Stanley Ho accused family members of seizing his stake in Asia’s biggest casino empire, plunging ownership of the gambling business he built over five decades into dispute.

Ho, 89, may take action to keep control of Sociedade de Turismo e Diversoes de Macau, said his lawyer Gordon Oldham, the senior partner of Oldham, Li & Nie. The transfer of most of Ho’s assets, announced yesterday, went against his wishes to divide them equally among his family, Oldham said.

“What really upsets him is that he’s not even dead yet, but in the twilight of his life his second and third families appear to be squabbling and pinching it for themselves,” Oldham said by phone today. “There’s no doubt that he has all his faculties.”

Brunswick Group, the public-relations company representing some of the family members, said today that Ho provided written authorization of the transfer of a 31.7 percent stake in STDM. The billionaire, who built his gambling empire after fleeing to Macau from Hong Kong ahead of the Japanese army in World War II, had started shifting assets after being released from a seven- month hospital stay last year.

‘Slight Concern’

SJM Holdings Ltd., the publicly traded arm of Asia’s biggest casino operator, halted its shares in Hong Kong trading today pending the release of a “price-sensitive statement.” SJM, which has the biggest gambling share in the former Portuguese colony, dropped the most in a month in Hong Kong trading yesterday.

SJM, operator of 20 casinos in the city whose gambling revenue is more than double that of all of Nevada’s, said yesterday that Ho agreed to transfer his stake in parent STDM to two companies owned by family members.

Ho’s succession plan may “fall into disarray,” Tan Teng Yee, an analyst for CIMB-GK Securities HK Ltd., said in a note to clients today. He downgraded SJM to “neutral” from “outperform” because of concerns that “management would be distracted by this tussle for power and wealth.”

The stake in STDM represented about 80 percent of the value of Ho’s assets, said Oldham. Ho may take legal action if the dispute isn’t settled within 48 hours, Oldham said.

“There’s a slight concern over the legal action,” Andrew Sullivan, director of institutional sales at OSK Securities Hong Kong Ltd., said by phone today. “There will be that split between family members. Yet whatever the outcome of the re- distribution, I very much doubt you’ll see the company severely damaged. Day-to-day running of the company will continue.”

Gambling Monopoly

Ho and partners in 1962 secured a gaming monopoly in Macau, a 10-square mile territory one hour by ferry from Hong Kong, from the colonial government. The city’s government ended his monopoly in 2004, allowing the entry of foreign operators such as billionaire Sheldon Adelson’s Las Vegas Sands Corp.

Ho sired 17 children with four women, according to his daughter Pansy, who is the Macau partner of MGM Resorts International.

Chan Un-chan, whom Ho refers to as his third wife, and children Pansy, Daisy, Maisy, Josie and Lawrence took control of Lanceford Co., which holds the biggest stake in STDM, at 31.7 percent, according to statements yesterday from SJM and Brunswick Group LLP, the public relations company for Lanceford. The five children are from the woman he refers to as his second wife, Lucina Laam King-ying.

Action Winner Holdings Ltd., owned by Chan, will hold a 50.55 percent stake in Lanceford, and Ranillo Investment Ltd., controlled by the five children, will have 49.45 percent, according to Brunswick yesterday.

Demanding an Explanation

Stanley Ho sent a letter to Daisy demanding an explanation for the change, and hasn’t seen a response, Oldham said, a claim disputed by Brunswick. Lanceford also holds other assets and represents the bulk of Stanley Ho’s wealth, Oldham said.

Ho was ranked Hong Kong’s 13th richest man with a net worth of $3.1 billion by Forbes magazine earlier this month. SJM is 56 percent owned by STDM, according to data compiled by Bloomberg.

Ho had approved the transfer of ownership and Daisy had responded in a Jan. 7 letter to her father’s queries, Brunswick said today in an e-mailed statement. Calls made to press secretaries for Pansy and Stanley weren’t answered.

Lawrence Ho has no comment according to Maggie Ma, a spokeswoman for Melco International Development Ltd. Lawrence is the chairman of Melco International, which rose 3.5 percent to HK$5.66 in Hong Kong trading.

Market Share

Ho last month transferred his 7.7 percent stake in SJM to Angela Leong, mother of his five youngest children, after he was released from a seven-month stay in a hospital last March.

SJM has a market share of 32.6 percent in Macau, the only place in China where casinos are legal, according to a Jan. 17 research note from CLSA Ltd. analysts Aaron Fischer and Huei Suen Ng. Sands China Ltd. has 16.5 percent followed by Wynn Macau Ltd. with 15 percent and Galaxy Entertainment Group Ltd. with 12.6 percent, the CLSA analysts estimated.
Gambling revenue for the six casino operators in the world’s biggest gambling hub rose 58 percent to 188.3 billion patacas ($23.5 billion) last year, according to government data. Last year’s increase of $8.6 billion is 50 percent more than the total gambling revenue for the Las Vegas Strip for all of 2010, according to data compiled by Bloomberg.

Shun Tak Holdings Ltd., a property developer that also operates ferries between Hong Kong and Macau, on Dec. 2 said Ho cut his direct ownership in the company in favor of two holding companies in which his children have stakes. Shun Tak fell 2.6 percent to HK$4.95 in Hong Kong trading.

bloomberg.com

[taxexile]

" lawyer Gordon Oldham, the senior partner of Oldham, Li & Nie."

didnt he used to work for the london firm of Sue, Grabbitt and Runne ?

[harrybarracuda]

Pansy, Daisy, Maisy, Josie

Is that The Pussycats?

[aging one]

good luck stanley, you made it now the kids are trying to steal it. go for it.

[Gerbil]

Having 17 kids is a bit of a recipe for disaster when it comes to sorting out your estate!

[nikster]

The day I feel sorry for a gambling don will never come.

[sabang]

good luck stanley, you made it now the kids are trying to steal it.

I don't think you know much about Stanley Ho.
There is little honour amongst thieves.