Decapitating GenM: Was It Systematic?

Yes, they have made mistakes before.

The latest foray into the UK may just be another bad deal given the more difficult gaming environment in Great Britain.

Yes, at the time of writing this blog, the Genting UK  suggested purchase has already been railroaded and approved at the EGM yesterday.

The purpose of this blog is just to find out just how much of the approximately RM6 billion reserve at GenM has been systematically whittled down.

Let us do our sums.

We will begin after the sell-off of a majority of shares in Star Cruises which originally cost the company USD442 million [RM1.42 billion].

The information I got was the coffers of GenM ex-Star Cruise sale of shares was slightly above RM5 billion. [If all the unnecessary purchases have not been executed, GenM would have close to RM6 billion by end of fiscal 2010.]

GenM then bought into 10% of Walker Digital Gaming for US$69 million (RM222 million)

Then last year, they arm-wrestled minority shareholders to acquire Wisma Genting and the Segambut property Oakland for RM284.1 million.

Now this takeover the UK operations using  more than one quarter of the GenM reserves.

And what about the USD50 million MGM notes. The money has to come from the reserves as well, right?

Then there is this gratis payment for the racino project at Queen's NY of USD380 million.

It looks like we have possibly burst all of the reserves given the feverish buy back of its shares recently as Treasury shares.

So, I do not see very much of the reserves of the RM5-6 billion left in GenM.

It has to start from square one, it seems.

What a whipping boy, GenM has turned out to be!