Melco Crown ups budget for City of Dreams Manila

    Melco Crown Entertainment’s Filipino unit plans to sell new shares to finance a major increase in the total budget for its City of Dreams project in Manila.
    The company is increasing its estimate for the Entertainment City resort by about a third, from $680 million to $832 million.
    Shares in Melco Crown (Philippines) Resorts were suspended in Manila pending the news and will resume trading on Thursday. The company gave no further details of the share issue in a stock exchange filing today.
    However, Bloomberg said the company will raise $129 million in an offer of as many as 485.2 million shares at 11.30 pesos to 11.70 pesos each.
    Melco last increased its budget on the project in October last year by 10 percent after receiving approval to increase the number of gaming tables.
    The company is scheduled to open its City of Dreams resort in October this year. The luxury project features a Hyatt Hotel with 365 rooms as well as Asia’s first hotel for luxury boutique Nobu. The company has also teamed up with Hollywood studio Dreamworks to bring an educational entertainment attraction built around some of the studio’s most popular characters, such as Shrek and Kung Fu Panda.
    The resort is expected to have 365 gaming tables, 1,680 slot machines and 1680 electronic gaming tables.
    According to Melco’s Q1 results, the City of Dreams had about $8.8 million of operating expenses, which primarily related to pre-opening costs as well as share based compensation costs. It recorded a net loss of approximately $21.8 million.