Francis Lui and the management team of of Galaxy Entertainment Group celebrate the clinching of the deal that saw Permira become the first international equity firm to put its weight behind a Chinese venture.

Global capital markets were abuzz in mid-October last year, when UK-based private equity company Permira announced it would acquire a 20 percent stake in Hong Kong and Macau-based casino operator Galaxy Entertainment Group in a $1 billion transaction

In a deal announced in mid-October last year, Permira acquired HK$3.8 billion ($490 million) worth of existing Galaxy shares held by Kah Wah International Holdings and subscribed for a further HK$2.7 billion worth of newly issued Galaxy shares. Approximately HK$1.3 billion of the subscription was applied to redeem around half of the outstanding fixed-rate notes, while the remaining HK$1.4 billion was a cash injection designated for Galaxy.

There are numerous reasons why Permira found Galaxy such an attractive investment. Galaxy holds an unrestricted gaming license in Macau – the only legalized gaming territory in China. Furthermore, Galaxy has a proven track record of being able to rapidly capture significant market share. It is also capable of building large-scale casino and hotel developments on time and within a budget. In addition, Galaxy owns the largest single land bank with a casino-approved license in Macau.

When Galaxy first met Permira, both parties recognized immediately that they shared the same vision, business approach and appreciation for China’s future economic potential.

“As an international strategic investor with valuable experience and connections in gaming and sports betting markets, Permira bring new ideas, market insights and product innovations essential to our future development,” said Galaxy’s Deputy Chairman Francis Lui.

Permira’s senior investment partner, Martin Clarke, agrees. “Galaxy has a unique blend of high-quality project development, gaming expertise, and an unrivalled understanding of Asian culture and the Chinese market.

“Permira investment validates Galaxy as a long-term player in the Macau gaming marketplace.”

This is not Permira’s first investment in the gaming industry; the group is also a major shareholder of Gala Coral, Europe’s largest gaming corporation.

The second “partnership of champions” that Galaxy has entered into is with the Japanese hotel chain, Okura. Okura opened its first hotel in 1962 in Tokyo. Today, Okura has over 24 luxury hotels in Asia, Europe and the Americas.

Okura is renowned for its “Best ACS” philosophy, which aims to provide its customers with the best accommodation, the best cuisine and the best service. Okura’s market position is world renowned. The chain owns the number one-ranked hotel in Tokyo, Japan and the number one-ranked hotel in Seoul, South Korea.

Okura is interested in extending its presence into Macau – the largest and the fastest-growing gaming market in the world. The main reason Galaxy was chosen as its business partner are in recognition of its efforts to build a truly authentic Asian casino resort, catering specifically to the vast Asian market. Okura will manage a luxury hotel within the Galaxy Mega Resort project that will include up to 400 hotel rooms and suites. Additionally Okura will offer an unparalleled selection of the finest Japanese food in Macau.

“We recognize our responsibility to contribute to the growth of Macau as a destination,” says Noriyoshi Owaga, Executive Director and Managing Corporate Executive Officer of Hotel Okura Tokyo. “Macau is transforming from a gaming only destination to gaming plus convention and family destination. The Japanese market is an important market for the future of Macau. We are confident that we can help send tourists to Macau from Japan and other countries.”

Adds Lui, “Hotel Okura will deliver at the Galaxy Mega Resort a distinctive premium service and luxury hotel brand that attracts customers from Japan and Asia. Okura Hotels offer all the modern amenities, yet retain the subtle aesthetic beauty and warm hospitality important to many of our Japanese and Asian customers. With a number of other strategic partners, Galaxy is creating one of the most exciting destination resorts in the World and Asia’s leading gaming and entertainment group.”

Galaxy is committed to bringing the finest hotels, restaurants, bars and entertainment to Macau. The group will soon announce further “partnerships of champions” that will give even greater strength to the Galaxy Mega Resort project and provide Galaxy Entertainment Group with a clearly differentiated offering and a winning resort formula.