The operator of Osaka’s 13-year-old Universal Studios Japan is counting on its reputation after turning around the failing theme park to win a partnership with a foreign casino operator as the country edges nearer to legalising gambling resorts.
USJ Co is in talks with MGM Resorts International, Caesars Entertainment and Genting regarding a possible joint venture to run a casino resort, says CEO Glenn Gumpel. “We have operational capacity, experience and I don’t think we would be stretched to participate in more than one casino resort,” he said. “As a company, we would like to grow outside of the current confines of the theme park.”
Japanese Prime Minister Shinzo Abe’s ruling party is seeking to pass a law to legalise casinos in the parliamentary session starting in the autumn as part of plans to boost tourism along with the Tokyo Olympics in 2020. Operators including MGM, Caesars and Las Vegas Sands have expressed interest to take part once the ban is lifted and pledged to spend billions of dollars to build resorts.
USJ joins Japanese companies such as Sega Sammy Holdings, Konami and Dynam Japan Holdings in competing for partnerships with casino operators in a market that could be Asia’s second largest after Macau and worth $40bn a year as early as 2025. The company is hoping its experience operating a theme park and knowledge of marketing and entertainment will help it to stand out from other suitors.
Osaka, a port city in western Japan, has been in talks with operators including Caesars and MGM for a $4.9bn resort, probably to be sited on a reclaimed island about three miles from USJ’s park. Other local governments including Tokyo, Yokohama, Hokkaido, Nagasaki and Okinawa have also expressed interest in hosting the resorts.
USJ is looking at Tokyo, Osaka and Okinawa for potential sites and would consider building a casino resort or a new theme park in Neo Park Okinawa, a nature park owned by Nago City, according to Gumpel, who joined the operator in 1999.
The company could seek to re-list on the Tokyo Stock Exchange as early as next summer as one of its financing options and is also considering an overseas listing. USJ had sales of Y95.9bn in the year up to March, an increase of 17 per cent from a year earlier.
