Wynn the master of Macau gamble
By Olivia Chung

Las Vegas gaming magnate Stephen Wynn's gamble that punters in Hong Kong, Macau and further afield would happily throw cash at shares in his Wynn Macau casino unit - and help pull his parent company back from a financial dark hole - has paid off hugely for all parties, with the stock surging on its trading debut on the Hong Kong exchange.

Wynn Macau earlier raised US$1.63 billion by selling a 25% stake in the Macau business, which has 600 hotel rooms, 380 gaming tables and 1,230 slot machines.

The shares, sold at HK$10.08 each, the high end of an indicated range, then rose as much as 13% on Friday before closing the day up 6.9% at HK$10.78

Wynn, whose gambling operations are the fourth-largest in Macau, decided to list the unit as parent Wynn Resorts' revenue

  

tumbled in the United States amid the global financial crisis. Earnings at Wynn Resorts have fallen for the past two years as fewer visitors showed up to spend at Las Vegas casinos and hotels. In contrast, earnings from Macau, the world's biggest gambling center, rose 48% to HK$2 billion last year, according to the company. The city contributed 57% of Wynn's second-quarter revenue.

Doubts have shrouded the wisdom of Wynn's gamble since his plans became public earlier this year. By early August, optimism over "green shoots" of a global economic recovery was beginning to wear thin, and a near five-month surge in stock markets since March looked to have run its course. In the immediate run-up to the Wynn Macau IPO, a string of Hong Kong listings had performed poorly by local standards.

Shares in state-owned Metallurgical Corporation of China, which raised HK$18.2 billion in the biggest initial public offering in Hong Kong to date this year, slumped more than 11% on their September 24 trading debut. By mid-day in Hong Kong on Friday, they were 13% below the offer price.

Others did little better in the wake of the Metallurgical listing, with menswear brand China Lilang, sports shoe maker Peak Sport Products and Shanghai developer Glorious Property Holdings all declining on their first trading day.

As recently as October 6, China Resources Cement Holdings (CRC), the biggest producer of the product in the heavily industrialized south of the country, fell 4.4% on its debut before easing back up to close at its offer price of  HK$3.90. CRC's pricing was 25 times its expected 2009 earnings per share (EPS).
The outlook started to turn this week, when the Australian government, the country's economy bolstered by strong sales to China of commodities such as iron ore, unexpectedly raised interest rates, the first leading economy to do so since the financial crisis struck. The move, signaling official optimism in the prospects for economic recovery, gave a boost to stock markets around the world, with new shares in Hong Kong among those benefiting.

In a string of trading debuts on Thursday, leading industrial gas supplier Yingde Gases Group gained 12% and China Vanadium Titano-Magnetite Mining rose 5.1%. Smaller Ausnutria Dairy Corp jumped 28% while Jiangchen International Holdings, an apparel manufacturer that raised a mere HK$33 million with its IPO, saw the value of its stock surge more than 400% before closing Thursday up 110%