Donaco International Acquires Star Vegas
In what it is calling a “transformational acquisition”, the Donaco International group has absorbed the Star Vegas casino in Cambodia. The Australian group recently reported an EBITDA increase of 36%, earning around A$65.3 million.
Now, Joey Lim, the group’s MD and CEO, is seeking out another transformational partnership in Japan. Lim entered the gaming industry with his grandfather, the late Lim Goh Tong. Lim Goh Tong is the man responsible for the famous Genting Group.
Though Joey Lim is currently involved in a legal battle with his uncle, Lim Kok Thay, Executive Chairman and CEO for the Genting Group, he is known to replicate the Genting Group’s approach in running Donaco. In fact, Lim is known to use the same procedures and systems, which he manages to continue through the hiring of Genting alumni.
The evolution of Donaco
Donaco first began operations in Lao Cai, a region located on the Vietnam-China border, close to the Yunnan Province. The Donaco casino was a 34-bedroom facility and was overseen by the Lao Cai government, which functioned as a minority partner.
The casino mostly relies on customers from China as Vietnamese citizens are banned from gambling, except in regions where the government is currently conducting a temporary experiment that allows gambling for citizens.
The original facility was replaced in 2014 with the 400-room Aristo International Hotel. The expansion also saw the number of gaming tables going from 8 to 40 and the acquisition of a license for 300 electronic gaming options.
Recent reports suggest that Lim might invest $2 billion at Lao Cai if the Vietnamese government were to permit gambling among locals.
The Star Vegas purchase
The recent Star Vegas purchase comes at a time when the group is just completing its expansion of the Lao Cai facility. Star Vegas is the largest casino in Poipet, which is close to the Cambodian border near Bangkok. It is home to 1498 electronic gaming options and 139 gaming tables. It also has an EBITDA that is 5 times more than what Aristo boasts of. The revenue is about 4 times higher.
Donaco is reported to have spent US$60 million on the acquisition.
Though Star Vegas went through a rough patch recently after the death of Thailand’s King, Lim believes that growth is in the stars. In fact, revenue went up by 41% in the recent financial year and full recovery is expected to occur in a year.
