Melco Resorts & Entertainment Ltd, a well-known name in the gaming industry, is rethinking its business strategy. The company, which operates City of Dreams Manila, is exploring an "asset-light" approach—a move that has sparked industry-wide speculation.

Why the Shift?

During a recent earnings call, Melco's Chairman and CEO, Lawrence Ho, elaborated on this new direction.

"We want to capitalize on our investments and reallocate resources efficiently," Ho explained. "This strategy will give us financial flexibility and support our long-term growth."

With the help of CBRE Capital Advisors, Inc. and Moelis & Company LLC, Melco is evaluating strategic alternatives for City of Dreams Manila. However, Ho was quick to caution:

"At this stage, nothing is set in stone. We’re exploring options, but there’s no guarantee that a transaction will happen."

The Belle Corporation Angle

With Melco possibly looking to exit City of Dreams Manila, industry experts speculated that Belle Corporation—the local landlord and partner—might step in to acquire Melco's stake. But Belle Corp. swiftly responded:

"We’re not planning to buy out Melco’s stake at the moment," a Belle Corp. representative stated. "Our focus remains on optimizing our existing operations."

What This Means for the Philippine Gaming Scene

The Philippine gaming industry is on the rise, with Pagcor (Philippine Amusement and Gaming Corporation) predicting a gross gaming revenue (GGR) increase to PHP 450 billion - PHP 480 billion this year, compared to PHP 410.5 billion in 2024.

If Melco decides to sell or restructure its position, it could mark a significant shift in the gaming landscape. Industry watchers are keen to see how this move unfolds.

What’s Next?

For now, Melco is keeping its cards close to its chest. Will it sell its stake? Will it find new investors? Or will it restructure operations?

As Ho put it:

"We are committed to making the best decision for the future of our company and our stakeholders. The journey ahead is exciting."

Only time will tell what’s in store for City of Dreams Manila. Stay tuned.