In a statement, Genting Malaysia informed investors that it will allocate approximately US$100M to its Empire Resorts in New York State. The funds will be sent via preferred stocks, and they can be converted into common equity after December 31, 2030. Empire Resorts will use US$58M to cover a bank loan with the rest going into general corporate purposes.
Just over a year ago, Genting acquired approximately US$100 million in preferred shares from the New York casino firm. After the recent capital injection, the parent company has invested almost US$725 million in the struggling entity. Preferred stocks are more appealing to investors as they prioritize payments of dividends.
Another Attempt to Rejuvenate the Operator
Not long ago, Empire Resorts was a publicly traded company and it had its financial difficulties. It runs Resorts World Catskills, Monticello Raceway, sports betting operations in New York and Resorts World Hudson Valley. However, the entity does not operate the Resorts World New York City, which is after a downstate casino license in the Empire State.
Still, industry experts believe that the latest move may be an effort by the parent company to win over New York regulators. Currently, Resorts World NYC is considered to be among the front-runners to win one of the three commercial gaming licenses. The Queens gaming property would be able to quickly generate more tax revenue for the state, in comparison to other facilities.
However, the process of awarding the three available licenses proves to be a slow-paced one, as it could be the second half of 2024 before the Empire State reveals the three winners of full-scale casino permits. Still, Genting Malaysia is demonstrating a commitment to its state operations, while others believe it is just making its last attempts to revitalize the New York operator.
In its filing, the parent firm said the proposed equity injection will allow it to strengthen its position and boost its market footprint in the expanding New York State’s scenery, hence competing effectively in the jurisdiction. It also shared that Resorts World Catskills will be able to continue benefiting from the synergies with Resorts World NYC.
Queens Communities Support its Expansion
As mentioned, Genting has a good chance of landing one of the three commercial gaming licenses in the Empire State, as Resorts World NYC has community support behind its back. A while back Queens clergy and civil rights groups, along with economic inclusion advocates, joined forces to demonstrate their backing for the expansion of the gaming property into a fully-fledged one.
In May 2023, the Jamaica Hospital Medical Center in Queens also declared its backing for the gaming establishment in South Ozone Park. Back then hospitals explained that the casino has been a valuable partner and generous supporter of the neighbourhood and wants to see it expand to a full-scale gaming property with live gaming tables and more.