The only bidder left is expected to submit its full proposal to the Japanese city on Tuesday
GM Resorts and Japanese financial services group Orix alliance, the only one that has indicated its intention to build and operate the Integrated Resort (IR) facility that Osaka Prefecture is offering, is planning an investment of US$9.09 billion (1 trillion yen), and it is expected to submit its full proposal to Osaka city and prefecture on Tuesday, according to a report by the Sankei.
The projected resort will include a casino, hotels, restaurants, a conference center and other entertainment facilities, and will be operated by both companies, while MGM will manage the casino.
The Osaka Integrated Resorts Fundamentals Plan included a total floor space of up to one million square meters, with a proposal for Japan’s largest international conference center.
MGM and Osaka will also commit to spending an additional US$182 million on infrastructure development costs, as part of a project to extend Osaka’s subway to the IR site of Yumeshima. These combined costs would see the total spend by MGM and Orix edge close to US$10 billion.
MGM and Orix are expected to be equal partners in this financial endeavour, and so far they have been the only operators to respond to the Osaka IR Promotion Office recruitment. That means that they are the only one group participating in the contest for the licensing.
According to a statement made in a weekly note to clients by Vitaly Umanski, senior research analyst at brokerage company Stanford C. Bernstein, “MGM would not be a controlling party of the development. This is the first clear sign the casino operators may have less than 50% or controlling stake”.
Osaka officials will examine the proposal before making a decision on whether to approve MGM and Orix as their official operator partner. The next step for the fellowship, in case they are accepted, will be submitting an application to the central government before April 2022.
Based on the business plan from the Orix-MGM Union, the prefecture is expected to be certified as an IR maintenance company around September this year. After that, the prefecture and the coalition will put together a final maintenance plan and apply to the national government for its certification around April next year.
The national government intends to approve IR Maintenance at up to three locations in Japan: Yokohama, Nagasaki and Wakayama. A large investment plan of US$9.1 billion is likely to be a tailwind for the government to approve prefectural business.