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Macau Legend says CEO resigns after arrest, shares plummet to record low
Macau Legend, , which owns and operates a casino resort in Macau, said its chief executive resigned on Monday after he was arrested and detained by police in the world's biggest gambling hub, sending shares down 19% to a record low.
CEO Chan Weng Lin's arrest comes as authorities have stepped up a crackdown on illicit capital outflows from the Chinese mainland, where all forms of gambling are illegal, and after the high-profile arrest of Suncity boss Alvin Chau in November.
Macau Legend said in a statement to the Hong Kong stock exchange that Chan resigned "to avoid distraction" to the company and for the interest of shareholders. It said it did not expect any adverse impact on its daily operations.
Police in the former Portuguese colony said in a statement on Monday that they had arrested two other people on charges of illegal gambling. They have arrested 15 people, including Chan and Chau, since November, on illegal gambling and money laundering charges. Six have been detained, they said.
Chan owns about a third of Macau Legend, which runs three casinos under a service agreement with SJM Holdings (0880.HK) and owns the Fishermans Wharf, an entertainment complex near the Macau ferry terminal. He is also chairman of Tak Chun Group, Macau's second-biggest operator of junkets - cross-border trips to Macau's casinos for high-spending gamblers - after Suncity.
Tak Chun did not immediately respond to a request for comment. Reuters was unable to reach Chan.
Analysts say the arrests herald a new era of zero tolerance of the promotion of gambling in China, in which the government supports development of the "mass market" segment, not high rollers.
Junket operators have traditionally offered easy credit to mainland Chinese VIPs, who play in Beijing-ruled Macau's casinos and handle their debts using underground financing channels.
Now nearly non-existent, the opaque VIP industry made up more than two-thirds of Macau's gambling revenue until just a few years ago.
Police said the latest arrests were linked to the Suncity case in November as the two groups - Suncity and Tak Chun -worked together, engaging in "illicit and criminal activities".
Suncity and Tak Chun have been the top two junket firms in Macau, employing thousands, but data from Macau's gambling regulator shows the number of licensed junkets has shrunk 46% over the past 12 months.
Shares in Macau Legend closed down 19% to a record low and fell as much as 29.8% to HK$0.40 during trading.
Macau Legend said in a statement to the Hong Kong stock exchange that Chan resigned "to avoid distraction" to the company and for the interest of shareholders. It said it did not expect any adverse impact on its daily operations.
Police in the former Portuguese colony said in a statement on Monday that they had arrested two other people on charges of illegal gambling. They have arrested 15 people, including Chan and Chau, since November, on illegal gambling and money laundering charges. Six have been detained, they said.
Chan owns about a third of Macau Legend, which runs three casinos under a service agreement with SJM Holdings (0880.HK) and owns the Fishermans Wharf, an entertainment complex near the Macau ferry terminal. He is also chairman of Tak Chun Group, Macau's second-biggest operator of junkets - cross-border trips to Macau's casinos for high-spending gamblers - after Suncity.
Tak Chun did not immediately respond to a request for comment. Reuters was unable to reach Chan.
Analysts say the arrests herald a new era of zero tolerance of the promotion of gambling in China, in which the government supports development of the "mass market" segment, not high rollers.
Junket operators have traditionally offered easy credit to mainland Chinese VIPs, who play in Beijing-ruled Macau's casinos and handle their debts using underground financing channels.
Now nearly non-existent, the opaque VIP industry made up more than two-thirds of Macau's gambling revenue until just a few years ago.
Police said the latest arrests were linked to the Suncity case in November as the two groups - Suncity and Tak Chun -worked together, engaging in "illicit and criminal activities".
Suncity and Tak Chun have been the top two junket firms in Macau, employing thousands, but data from Macau's gambling regulator shows the number of licensed junkets has shrunk 46% over the past 12 months.
Shares in Macau Legend closed down 19% to a record low and fell as much as 29.8% to HK$0.40 during trading.
