Monday 17 October 2016 04:57 PM
UPDATE: SkyCity shares drop on arrest of rival's Chinese staff
(UPDATE: Rewrite to reflect Crown statement to the ASX, drops attribution to AFR)
By Edwin Mitson
Oct. 17 (BusinessDesk) - SkyCity Entertainment Group shares fell in response to the arrest of 18 staff employed by its Australian rival, Crown Resorts, by the Chinese government.
In a statement to the ASX, Crown Resorts said that one of those arrested was its Executive Vice President VIP International, Jason O'Connor. It also confirmed the arrests, which were first reported by the Australian Financial Review.
Shares in the Auckland-based casino and hotel fell 4.1 percent, or 19 cents, to $4.45, outpacing a 1.2 percent slide in the NZX 50 Index. Shares in Crown were down almost 10% in trading on the ASX.
At the publication of its full-year results in August, SkyCity said that it's international business boosted earnings before interest and taxation to $37.3 million due to what it termed new 'grand horizon' gaming salons in Auckland, which it said had been popular with Asian VIP customers. It also said these salons and a new salon in Adelaide, would ease capacity constraints during peak periods such as Chinese New Year and Golden Week.
In China it is illegal to arrange for more than 10 people to gamble overseas. Crown said it had been unable to speak with its employees and is working closely with the Australian Department of Foreign Affairs and Trade. It has now been told why its employees have been detained.
Last week, SkyCity said its President of International Business, Ejaaz Dean, was to leave to take up a new role as the managing director of a gaming property in Europe. He's to begin his new role at the start of next year.
Shares in SkyCity have risen by 5.9 percent since the start of the year.