GENTING Bhd’s recent corporate moves have put a spotlight on the group’s commitment to other businesses.
The group, primarily known for its gaming and leisure business, now appears to be shifting its focus towards expanding other areas of its operations beyond its mainstay activities.
While its chairman and chief executive Tan Sri Lim Kok Thay asserts the group still derives the majority of its revenues from the gaming and leisure business, his recent statement appears to hint that further diversifying the group’s interests will be a key part of its corporate strategy moving forward.
Genting is today a diversified group, holding majority stakes in several subsidiaries, including public-listed ones such as Genting Singapore Ltd, in which it has a 52.6% stake, and Genting Malaysia Bhd, with 49.3%, both of which operate in the gaming and leisure business.
Genting also has stakes in other resorts and casinos such as Resorts World Las Vegas LLC.
Apart from that, the group also has a significant presence in other industries through its 55.4% stake in integrated plantation company Genting Plantations Bhd and wholly owned Genting Energy Ltd.
The announcement on Thursday that it would invest more money into the energy segment is an indication that it will see its other non-traditional business segments grow in the future.
“The energy business will be a major contributor to the group moving forward,” Genting’s president, executive director and chief operating officer Datuk Seri Tan Kong Han, says.
Lim’s statement during a recent press briefing gives further insight into the mind of the company’s management, especially with regards to its mainstay gaming operations.
“Gaming, while it is still a big part of our business today, is in itself also changing, especially with the rise of online (gaming). In Malaysia, we have very limited potential to expand the footprint of our gaming business. But in other countries that have called for legislation on (online) gaming, (there will be opportunities) and we will explore going there,” Lim says.
“If it meets our expected returns, we will definitely continue to be invested in this area,” he adds.
Genting earlier this week said it had acquired a 49% stake in a gas-fired power plant in China, and it would be engaging China-based Wison New Energies Co Ltd to build a floating liquefied natural gas (FLNG) facility under a contract worth US$962.8mil.
Once completed, FLNG facility will be deployed at Teluk Bintuni, West Papua, Indonesia.
The facility is expected to have an annual capacity of up to 1.2 million tonnes under a contract with Indonesia’s oil and gas regulator estimated to last 27 months, Genting said in a statement.
The two projects are anticipated to come onstream in the next two years or so.
Tan notes, based on rough projections at current prices, these projects are poised to grow its energy business revenues to up to US$1.4bil a year from US$365.7mil at the end of last year.
For comparison, Tan says, the leisure and hospitality segment contributed about US$4.9bil in annual revenues for 2023 against total group revenues of around US$5.77bil (based on US dollar exchange rate of RM4.7 per US dollar).
On whether Genting has any plan to venture into the booming data centre business, Tan says, there is no such intention by the group, adding that the data centre business is not easy to enter or maintain.
“Data centres requires a lot of factors to ensure success. Apart from power, you will need water. The various states, where data centres are being set up, such as Selangor and Johor, are actually short of water,” he points out.
Meanwhile, Genting’s 20%-owned associate, TauRx Pharmaceuticals Ltd, is reported to have made significant progress on a treatment for Alzheimer’s disease.
Earlier this year, TauRx, based in Aberdeen, Scotland, said its data showed that its trial drug to combat Alzheimer’s showed “sustained benefits across the disease spectrum from early to moderate dementia”.
The treatment is undergoing clinical trials and has been submitted for approval from regulatory authorities such as the US Food and Drug Administration, says Lim.
It is the group’s hope to introduce the drug to those who need it at an affordable price, he adds.
According to Lim, there will be more developments in the group’s other non-traditional business segments, and these will be announced gradually over time.
“There are a few other projects that we are working on, which hopefully, we will able to share with you in time to come. Continue to watch this space, as the transformation of Genting is just starting.
“The world is different and it has changed. Companies that are able to keep pace with the change and have the will to face the challenges will be the companies of the future. And we certainly hope that Genting will be a company of the future not just here in Malaysia but also abroad,” Lim says.
“We have been in the gaming business here in Malaysia for more than 50 years. We rarely explain our long-term strategy unless it is more or less proven. In life, if we don’t try and work hard at it, the chances of success are lower. This culture instilled by our group’s founder is one of working hard to prove ourselves,” Lim adds.
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