No govt plan to fund Marina IR: Iswaran

Source : Business Times - 13 Nov 2008

GLCs, as commercial enterprises, will make their own investment decisions
THE government does not plan to fund the Marina Bay Sands project if casino operator Las Vegas Sands runs into financial problems, a trade minister said yesterday.
‘There’s been no request for a government bailout from Marina Bay Sands and neither does the government intend to do one,’ Senior Minister of State for Trade and Industry S Iswaran said on the sidelines of an event yesterday.
‘This has always been a commercial project and the solutions to the challenges posed by the current economic environment and the financial market situation really lie in the commercial sector as well,’ he said.
Las Vegas Sands said on Tuesday that it would halt expansion in Macau to focus on completing the Marina Bay project - dubbed as the company’s No 1 priority by chairman and chief executive Sheldon Adelson.
The casino operator, listed on the New York Stock Exchange, also said that it was working to raise about US$2 billion in capital and would channel some of the funds to the project here.
But Las Vegas Sands admitted that there would be delays, noting that the casino would be opened in two phases which will extend into early 2010. The project was slated to open fully in 2009.
Las Vegas Sands has proposed to the Singapore Tourism Board (STB) to modify the project timeline, said Mr Iswaran, adding that STB has not decided if the casino operator would be penalised for the changes under the development agreement.
‘So far, STB has not agreed to any of these variations,’ he said. ‘Their proposal was to complete the whole project by 2009. If there’s a variation to that, we need to look at that and see whether there are legitimate reasons for it.’
Mr Iswaran declined to reveal what specific requests had been made by the casino operator, citing confidentiality issues.
Disclosures would be made ‘at the appropriate time’, he said.
He added that while the government is still studying the proposal, STB has ‘very clear rights’ under the development agreement outlining the original project timeline.
‘We have those rights and they’ve been very well demarcated,’ he said. ‘They’re there to be exercised, if there are any eventualities.’
STB declined to reveal the terms of the development agreement when contacted.
The delay is unlikely to change the creation of the 10,000 jobs from the casino, said Mr Iswaran.
Market talk has been that government-linked companies (GLCs) could be poised to take a stake and inject funding if needed.
In response, Mr Iswaran said that GLCs are ‘commercial enterprises’.
‘They have to make their own decisions on whether an investment makes sense for them or not,’ he said. ‘It’s not for the government to tell them what to do.’