Mohegan Gaming & Entertainment is finally divulging details regarding the sudden withdrawal of its integrated resort (IR) development partner in Japan.
Mohegan Gaming, the gaming unit of the Mohegan Tribe of Connecticut, says it was Oshidori International Development’s decision — and its decision alone — to fold on the consortium’s ambitions of winning licensure in Nagasaki.
You may have recently read that Oshidori has withdrawn its bid for an IR in Nagasaki,” Ray Pineault, president and CEO of Mohegan Gaming & Entertainment, said during the company’s earnings call today.
“This decision was made solely by Oshidori and does not have any significant financial impact on us, as we were providing operational expertise and assistance for the RFP (request for proposal) process and did not anticipate any meaningful cash flows or expenses related to this project,” Pineault explained.
Folding on Japan
Mohegan Gaming was one of the most well-known global casino firms still involved in Japan’s ongoing liberalization of commercial casino gambling. Now, it joins a laundry list of major players that have exited consideration.
The world’s biggest casino companies once viewed the forthcoming market as the greatest gaming opportunity since China’s Macau some two decades ago. That’s before COVID-19 and Japan’s tedious, long process to issue IR development licenses,
Las Vegas Sands was presumably a sure thing for one Japan’s IR permits. But in March of 2020, the company shocked the gaming industry by announcing its withdrawal. Late Sands founder Sheldon Adelson said at the time regarding the company moving forward sans Japan, “The framework around the development of an IR has made our goals there unreachable.”
Along with Sands, Wynn Resorts and Caesars Entertainment are no longer actively bidding in Japan. And though MGM Resorts remains part of a consortium in Osaka, it is seeking to reduce its investment and ownership stake from previous plans.
Mohegan’s exit, albeit not on its own accord, is the latest bombshell for Japan’s gaming legalization efforts.
Oshidori Questions Loss
Despite operating integrated resort casinos in the US, Canada, and in the coming years South Korea and Greece, Mohegan Gaming’s pitch in Nagasaki wasn’t graded the highest by prefecture and city officials. Following Oshidori International’s abrupt exit revelation, Nagasaki announced that Casinos Austria had been picked as its preferred IR partner.
The Nagasaki government said Casinos Austria’s pitch scored 697.0 points. The Mohegan/Oshidori scheme was next at 682.8 points. Oshidori alleged that the rating process was flawed. The IR subsidiary of Oshidori International Holdings — a financial services firm in Japan — said it only sought to participate in an IR process that is “conducted in an ethical manner.”
“Oshidori has encountered several incidents that make it question whether there have been serious ethical irregularities. [Oshidori] is only interested in participating in a process that has the highest integrity, and that is professional, transparent, and based on merit,” the statement added.
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