PAGCOR-run casinos up for privatization first, DoF says
THE DEPARTMENT of Finance (DoF) will prioritize the privatization of casinos solely owned by the state gaming regulator-operator Philippine Amusement and Gaming Corp. (PAGCOR).
“We are working on the PAGCOR deal. The first item is those casinos being operated directly by PAGCOR which I think should be privatized first,” Finance Secretary Carlos G. Dominguez III told reporters on Thursday at the Finance department.
He cited the casino in Fort Ilocandia Resort Hotel. “It’s mostly in the provinces, where they actually do the operations. That’s the first step so that is what we are working on at the moment,” Mr. Dominguez added.
He said that there are about 17 casinos solely owned by PAGCOR, while the remainder out of a total of 46 nationwide are operated by the regulator through a joint venture with private firms.
“Sometimes they lease the facility... they lease it and operate the casino, others they go into joint venture with the hotel. They share their revenues. It’s not one model,” he said.
Finance Undersecretary Grace Karen G. Singson of the DoF’s privatization group said some ownership structures can involve as many as four partners, handling various components of the operation, such as hotel management, slot machines and online gaming.
“We have to study now how to privatize” with varying deal structures she said.
Mr. Dominguez said that the Finance department aims to complete its review of the privatization process by the end of the year.
“We want to complete all the studies by the end of the year. And then we’ll figure out the method of privatization.” Asked whether the actual transfer of assets to the private sector will happen in 2018, the Finance chief responded: “I hope so.”
“It’s not going to happen overnight, and the deals are quite complex so we have to piece it out and see what is the best deal for the government,” he added.
Mr. Dominguez said that the department is analyzing how much revenue is generated by PAGCOR’s winnings compared to the fees being paid by private casino operators.
Mr. Dominguez said valuations could vary widely by location, but he sees one possible benchmark — metrics relating to operating capacity such as number of tables and number of visitors over the past year.
So far, no stakeholders have expressed any interest to developing PAGCOR-run casinos.
“But I am sure there are people waiting on the sidelines,” he added.
As for the employees that will be affected by the transfer of assets, he said that they can be hired by the casino’s new operator.
“They are the ones with experience, they are already trained, so I don’t see a problem there. In fact they even get more money (in the private sector),” Mr. Dominguez said. —