no one knows whY??

I read today about their RPT(related party transaction) transaction which involves a call option cancellation, to which I assume should be a good news for GenM, as it doesn't need to fork out millions of USD to acquire such a company.
Maybe some investors misread it as a weakness, but I think its good that they drop the purchase.

What do you guys think of the impact of calling off the acquisition of Bromet Limited and Digital Tree (USA) Inc ? Nowhere can trace the reason of the withdrawal, under the pressure of other shareholders in the market (Share price reflects the disagreement) ?

More and more cash stuck in Genting M. Seems they are not wisely utilising their cash.

It is a good thing they call it off. Basically, Walker Digital is an investment mistake made by the Lim family private arm Kien Huat Realty. But, in order to reduce the loss from this mistake, they do a related party transaction and sell the failed investment to GENM to recoup the mistake. Burried deep into GENM financial statement for this period is an impairment loss for Walker Digital worth RM108million. They bought the firm at RM 227 million (at current USD-MYR exchange rate). It is about 50% write off in less than one and a half year when there is an uptick in casino business and gaming business globally.The timing of such a write off is very suspicious. These just shows that the family know it is a bad business all this while. They are waiting for a right time to write off the thing without creating much fuss i.e. a time when GENM result improve significant enough to cover the loss from Impairment Loss so that the YOY change do not look that different. Investors tend to look at the bottom line figure, when it does not fall or change too much, they would not ask "why?".The improving result in GENM give this quarter give them just the right opportunity to do so. Basically, GENM just bail out the Lim family from a bad mistake.

GENM and Genting is basically a company with a good business(Genting Highland and Sentosa) but with an incompetent and overpaid CEO that do not know what to do with the cash and put his own interest over that of the minority shareholders. It has been a long time we heard that they are looking for opportunity for acquisition, but they seem to be unable to find anything to buy or perhaps are saying that to appease the shareholder. With the current management track record in Star Cruise(Genting HK) and Genting UK, it is better for them to return the cash.

It is ok to buy into a company with bad management and sound and defensive business, but your entry price need to be low and must realize that GENM and Genting would not be able to fulfill their full potential with the current management in place. Do take note of the intensifying competition of casinos in SEA, there are new ones coming up at Phil and Vietnam. Genting Highland will largely be shielded but Sentosa will face some pressure.

This post has been edited by the snowball: May 30 2010, 03:21 PM

Thanks for the review, what ashame how they make use of GenM, not to mention they chose to sell off their properties to Genting M from Genting to fund Sentosa rather than another more welcomed method by delivering dividend.

My entry price was averagely at RM2.20, I chose the stock was because of the pile of cash which I hope may lead to expansion, GenM was once venturing into Taiwan Casino which however been dropped by local folks. I understand that Indonesia and Thailand also eyeing on casino in their soil, seems Genting M will not grow significantly bigger in future but being a cash cow accumulating cash (Opportunity for Lim family to manipulate). Since the management has failing ability to manage their cash, I tend not to hold this for long term investment.

Welcome. I think to reduce corporate governance risk, the best listed Genting Group vehicle to own is Genting Berhad cause it is directly own by the family arm, Kien Huat Realty. The rest of the companies are more indirectly related to the Lim family like GENM, so, they can do whatever they like with the company.

For Indonesia, initially Bintan Island seemed to have awarded a license to Landmark, a company which Genting have significant holdings, but, after that, some political problem and the casino license seem to be on hold or been cancelled for now. I am not really sure whether other government will allow Genting to build the casino in their country after they see what Genting build on Sentosa. Because, if you compare the Sentosa Resorts and the Marina Bay Sands, Marina Bay Sands(MBS) is really 2 or 3 times more grand than Genting. Punters regardless of rich or poor would prefer MBS because the minimum bet in both casino is the same.

I have to agree that their cash management left much to be desired. They don't know what to do with the cash, but, refuse to return to the shareholders. Now, they even waste money to buy some bank in Sri Lanka.

This post has been edited by the snowball: May 30 2010, 10:00 PM

Well they have a piece of Phil via RWM(Resort World Manila) which just hosted an APPT event. The event was tauted to be the best and most well organized Poker event so far this year in the AP region

lol it seems that the crowds are doing this for now.

Mostly people go for Genting Singapore, more potential.
(personal opinion)

Did you read this statement?

Ya but the exposure is rather small as it is via Genting Hong Kong(formerly Star Cruise). I think Genting want to get its hand on every single casino pie in the region.


Got one thing that Genting Sentosa may beat MBS is that the parking cost for MBS is obscenely expensive. Even after they give you a discount, it is still very expensive to gamble there for a night if you are driving.

O.o is there any Genting in Hong Kong?

It is actually Star Cruise but it has been renamed as Genting Hong Kong as part of the rebranding exercise that Genting group is currently embarking like Resorts being renamed as GENM, Asiatic and Genting Plantation etc...

Genting Hong Kong is listed in the HKEX.

Well after the successful tournament I hope it will boost their exposure in the Philippines market. Anyway Star Cruise is not doing well right?

For gambling sector, whether the economy is bad/worst or good, majority business will be good, bcos people like gamblings alot directly or indirectly.

investing in the counter should have no worries. just imagine what business is as good as gambling business. daily profit talking about millions

GENM by Alex Lu

Haha, I think I have misunderstood you previously on your meaning of exposure with my own. I believe your "exposure" means the exposure to the Phil casino to the Phil market, in this case, the exposure is huge as the Resorts World at Manila is actually part of the Phil govt plan to develop a similar Singapore IR-style resort. While I have misunderstood your definition of exposure as the exposure of GENM to RW Philipines earnings, in this case, the exposure is rather small as GENM owns 19+% of GEN HK while GEN HK in turns own roughly 50% of RW Phil, so in total the exposure to GENM is around 10% while to Genting it is even smaller at less than 5%.

But, this exposure is not exposure in accounting sense as GENM ownership in GEN HK is less than 20%, hence,based on accounting rule, it is not consolidated into GENM earnings, so no matter how well RW Phil did, it will not be reflected in GENM P &L. GENM ownership in GEN HK is actually classified as Available-for-Sale Securities(AFS). As an AFS, any changes in the share price of GEN HK need to be reflected in GENM P&L, so, you will see a huge fair value gain or losses in GENM P&L every quarter due to changes in GEN HK share price. But, if RW Phil did well, GENM should benefit from the increase in share price of GEN HK.

Actually, the accounting treatment of GEN HK kinda answer your question on the state of Star Cruise or GEN HK as it is called now. GEN HK performed so badly that it has been a drag on GENM earnings and share price that I believe the Lim family actually secretly funded famous Malaysian financier Datuk Chua Ma Yu(CMY) to take over 14% of GEN HK shares from GENM so that the result of GEN HK will not be consolidated in GENM books. This is merely cosmestic changes on GENM accounting treatment, the fundamentals of GEN HK remains bad. But, it did hide the fact somewhat from GENM shareholders that GEN HK is burning cash.I have a reason to think so as I don't think CMY have so much money to buy 14% of GEN HK plus I don't see any reason for him to splurge a significant part of his wealth to buy a NON-CONTROLLING and minority stake in GEN HK, so I think it should be funded secretly by Lim family. Haha..that's my conspiracy theory but I think it is rather valid as I don't see any other motive for CMY to spend a huge chunk of his wealth on a non-controlling stake in a cash-burning company.

As for the state of Star Cruises now, well, they have brought in quite famous private equity firm, Apollo as a co-investor for Norweigian cruise line(NCL). Hopefully, the PE firm will help them streamline NCL activities and hopefully turn it around. As PE firm exit strategy is to do IPO, perhaps we may have another Genting vehicle being listed next time. As for the rest of Star Cruises, I believe the fundamentals is still bad. Buying Star Cruise is a bad call by LKT. Perhaps, his ideas is too forward for our generation? haha..or a more valid one is that he is a pale shadow of his father.



A legal gambling business is actually not as profitable as most people think it is. Genting is so profitable because it is a monopoly. A lot of casinos in Macau apart from the big 3 (Wynn, SJM and LVS) loss a lot of money during the previos FY. This is due to the fact that a legal casino have a lot of overheads cost. Just imagine the cost of setting up those entertainment and other activities that are not profitable to attract people to gamble at their casino. All these attractions forms a huge chunk of their operating cost and is usually not profitable activities. So, legal casino is not that profitable in an ultra-competitive environment.

This post has been edited by the snowball: Jun 2 2010, 11:18 PM

snowball, you really have in depth review of Genting.

wow CMY is in play? That's very old news but I kinda forget about it until you just mention. Well sorry for the misunderstood about exposure. We can only hope that if RWM is famous it's sister casinos can somehow get the spill over effect

Genting Malaysia to buy Genting Singapore UK operation. News here :http://www.btimes.com.my/articles/20100701183315/Article/ . What a big rip -off of GENM shareholders! I feel sad for anyone that is holding GENM right now. Says good bye to your cash hoard and acquisition opportunities. Genting management basically want to unlock Genting Singapore value, so, GENM have to take this money-losing business.

That's the reason why I said owning Genting is better than GENM if you really want to own something manage by LKT. Coz Genting corporate governance risk is lower as it is more directly related to the Lim family. Regardless of what, this is second time in as many years that GENM cash hoard is wrongly utilized.

As such Genting Singapore will be a good buy now? Actually Genting's UK Operation was done by Justin Leong