Questions remain over Pansy Ho’s role at MGM China – Brokerage

Analysts at Sanford C. Bernstein indicated today (Tuesday) that the management restructures announced by MGM China’s Co-Chairperson and Managing Director, Pansy Ho, following the retirement of Grant Bowie as CEO still left some doubts over Ho’s role in the gaming operator.

In an internal announcement to the company’s staff, Pansy Ho revealed that executives Hubert Wang and Kenneth Feng would take over new functions and roles over the company’s day-to-day operations, with the brokerage considering that Ho ‘seems to be taking a more active role at the company’.

‘[This] comes as somewhat of a surprise to us. We have concerns around this structure as there is limited direct casino operations and marketing management experience among the top executives,’ analysts Vitaly Umansky, Eunice Lee and Kelsey Zhu stated in a note issued today.

‘While the next layer of management is not changing (based on what we know today), casino marketing and operations management experience is light at the top with two finance and business development executives now fully in charge of casino and hospitality.

The brokerage considered that MGM’s Cotai property has had a ‘slow ramp-up’, with the group facing renewed competition from new properties, such as SJM’s Grand Lisboa Palace, opening in 2021.

Ho is also Executive Chairperson and Managing Director of real estate and transportation company Shun Tak, and is also on the board of STDM, with the death of patriarch Stanley Ho last week leaving some unanswered questions over the future management of the gaming empire.

However, Bernstein noted that while the move does seem as if Pansy Ho is taking a greater involvement in MGM China, the brokerage does not expect her to take a bigger role at SJM, despite her influence in the gaming concessionaire.

In fact, Bernstein considered as some of the main risks for MGM China in the future to be if its management structure is not capable of dealing with headwinds posed by Covid-19 and future competitor capacity expansion, and a possible Pansy Ho potential disengagement or the potential sale of her shares in the group.

‘While she has no direct role in SJM […] we believe she wields influence (for example, her sister Daisy Ho is Chairman of SJM and CFO of Shun Tak) […] This continues to be an issue to us with respect to conflicts that may arise. With respect to SJM, there has been much investor interest in possible management changes at the company since spring 2019 when the STDM board seemed to become in the control of the “Pansy Ho Alliance”‘

SJM’s 10 board seats are know comprised of Pansy Ho, and her sisters Daisy and Maisy, together with Timothy Fok, Eric Fok and Jeremy Fok, Ina Chan, Angela Leong, Patrick Tsang and SJM executive director David Shum.

SJM is expected to hold a board general meeting on June 9 which will put four seats up for re-election.