Playboy Enterprises (PLA) is expanding its empire into the up-and-coming gambling mecca of Macao. Late last month, the company announced a joint venture to build some 40,000 square feet of nightlife, retail, and Hugh Hefner-branded lodging -- as part of the Macao Studio City Development. Will "Playboy Mansion Macao" play well with China's conservative values?
Playboy CEO Christie Hefner joins the guys for this conversation. Following are excerpts of what was said.
Can Playboy meet expectations in Macao?
“I think we have the power of the Playboy brand in Asia. We’ve been selling Playboy consumer products in over 400 stores for more than 20 years in mainland China and we have Playboy concept stores in Hong Kong, Tokyo, Bangkok and more.” says Hefner.
She adds ”The potential is for Macao to not only be a gaming market, which it already is – but to truly become the capital in Asia for conventions and tourism. That means entertainment plus gaming. And we’re part of something called Macao Studio City… which is going to have just that.”
How much will it cost you and when do you open?
“We open in the end of 2009," replies Hefner. We haven’t disclosed the cost of our projects, but we do have an earnings call on August 7th and we’ll be talking more about it.”
Will you be talking favorably?
“Quite favorably.” she says. “We’ve done extremely well in Vegas… people are willing to wait an hour and a half and pay a $50 cover charge to get into the Playboy Casino Club. And I think we’re going to do equally well in Macao.”
Dylan Ratigan asks Eric Bolling what he thinks?
Eric says Playboy will have a tough time because the opening is several years down the road and he doesn’t think their casinos are big enough. He believes Playboy in Vegas is only successful because it partnered with The Palms.
“That’s exactly why it’s going to succeed in Macao,” says Hefner. “It’s the same concept. That is, to partner with a bigger project that’s going to be operated by Melco (MPEL). (It) has a huge casino space… and we bring the Playboy twist to it, so there’s differential incremental gaming. (And there’s also) the club, plus a Hugh Hefner style villa….and the project has a great location.”
Eric is convinced.
Dylan asks the other guys what they think.
They all like this stock.
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