Mega Stars told to focus on tiny Tinian after Saipan license defeat

Published in: Latest Intelligence Mega Stars Overseas, whose Marianas Stars Entertainment unit this week missed out on a $2 billion casino license on the island of Saipan, has been urged to re-channel its efforts into bolstering its project on neighbouring Tinian.
Tinian Mayor Ramon M. Dela Cruz said Mega Stars executives should take advantage of the window of opportunity before the new luxury resort is built to protect their investments on Tinian and to promote its brand overseas.
Mega Stars owns the Tinian Dynasty Hotel & Casino, the only casino currently operating in the Commonwealth of Northern Mariana Islands. 
Mega Stars plans a $50 million renovation of the hotel, construction of the largest water park in Western Pacific and the construction of a resort at Tachogna Beach on Tinian to make it a world-class destination.
The CNMI’s Lottery Commission on Tuesday voted in favour of a rival project to Marianas Stars, choosing to grant a license to Hong Kong-based Best Sunshine International. 
Best Sunshine is registered in the CNMI as Imperial Pacific International (CNMI) LLC, named after its parent company, the Hong Kong-listed Imperial Pacific which was formerly known as First Natural Foods Holdings Ltd.
The decision, which had been expected, came after months of often acrimonious legal wrangling between the two parties. Best Sunshine’s parent also publicly offered to make a $10 million contribution to the local community, distributing the amount through cash vouchers to all locally born adults, if it won. It also pledged $20 million in cash to be distributed within 60 days of commencing construction works on its first hotel in the project and at least $20 million in cash every year after the first full year of operations, none of which helped dispel impressions the award was weighted in its favor.
Dela Cruz, who has been an active supporter of Mega Stars, said he was “disappointed.”
The mayor acknowledged the company’s efforts to keep the casino industry on Tinian afloat.  
Mega Stars has plowed over $40 million in investments into Tinian and is scheduled to infuse more than $600 million more to revive the economy there.
The mayor said many believe that the casino law was tailored for Best Sunshine from the outset. “Everybody expected that the law was tailored for Best Sunshine,” he said.
De La Cruz earlier asked the Administration of Governor Eloy S. Inso to consider two licenses, which he said would bode well for the CNMI as it would be getting twice the casino revenues. His request fell on deaf ears.
A report from U.S. consultants tasked with assessing the merits of the two projects showed that the balance tilted in favor of Best Sunshine, with 67.5 points out of 100 compared to Marianas Stars’ 51 points.
U.S. based consultant The Innovation Group president Michael Soll said that this is an acceptable threshold on which to base negotiations.
While an assessment from B2G Global Strategies, the second consultant, may also have hurt Marianas Stars’ chances at clinching the coveted casino license. It faulted the applicant for its failure to comply with the regulatory requirements of the Tinian Casino Gaming Control which, back in May, returned Mega Stars’ application for a license to operate Tinian Dynasty.
But Park Strategies LLC senior vice president Sean King, consultant to Marianas Stars, said the assessment was untrue as the company is still actively engaged with the Tinian regulator over the requirements.
“Marianas Stars respects and appreciates the findings from consultants The Innovation Group and B2G Global Strategies.  However, with respect to B2G’s conclusions regarding parent company Mega Stars’ gaming operations on Tinian, Mega Stars wants to clarify that it has in fact been cooperating with the Tinian Casino Gaming Control Commission as it regards TCGCC Resolution No. 14-01 dated May 23rd, 2014,” he said.
The decision to award and move ahead with the casino license means retirees in the Northern Marianas will finally see their deferred 25 percent retirement benefits restored.
The members of the Lottery Commission, composed of Chairman Sixto K. Igisomar, Finance Secretary Larissa Larson, Acting Attorney General Gil Birnbrich and Department of Public Safety Commissioner James Deleon Guerrero, listened to the testimonies of the retirees, before they made their choice favoring Best Sunshine. 
Despite Mega Stars commitment to continue with its Tinian project, analysts have said the addition of a five-star resort on a neighbouring island with much better infrastructure, may sound the death knell for the struggling Tinian Dynasty, which has been open since 1998, but has never made a profit.
Currently, the Tinian International Airport is not ready to receive international flights pending rehabilitation of its terminal.  While there is only one local airline – Star Marianas Air-- plying the Saipan-Tinian route.
The island is 2,115 miles away from Hong Kong, 1,475 miles away from Tokyo and 1,931 miles from Seoul.
Meanwhile, experts are upbeat about the prospects for the much bigger Saipan, which does have international transport links and has reported interest from Asia, in particular from Macau junket operators.
The island, with a population of 48,220 compared with just 3,316 on Tinian, is seen as having the necessary critical mass to support larger-scale tourism infrastructure. 
 

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