Melco Resorts & Entertainment Ltd. is steering its future far from the glitz of Macau and closer to emerging markets with one eye firmly on debt control. Its new plan? Expand globally, but without the financial weight of owning everything outright.
CEO Lawrence Ho says the company is going asset-light—focusing on partnerships, not properties. The model’s debut? A gleaming new casino in Colombo, Sri Lanka, where Ho laid out Melco’s vision in a candid interview this weekend.
Why Melco Is Betting on a Leaner, Lighter Future
The casino giant’s decision to lighten its capital load didn’t come out of nowhere. Ho’s not hiding the fact: post-pandemic recovery in Macau has been sluggish, and competition is fiercer than ever.
Instead of pouring billions into new builds, Melco plans to tap into local expertise and split the risk.
Ho said bluntly: “Having these new opportunities come up, our asset-light strategy allows us to do those and also have management fees and EBITDA associated with it, without committing serious capital.”
One sentence, but it says a lot.
Melco will offer its brand, operational know-how, and casino management. In return, local partners foot more of the development bill. The payoff for Melco? Recurring fees and profit shares, minus the huge upfront costs.
And yes, it’s also about reducing the company’s debt load—a concern that’s been hanging over all major players in the sector since COVID lockdowns wreaked havoc on tourism.
Why Colombo Is More Than Just a Test Case
This isn’t just another flashy launch for photo ops. Melco’s new Colombo casino is ground zero for its reimagined expansion model. The Sri Lankan capital isn’t exactly a hotbed for international casino investment—but that’s part of the point.
It’s a real-world trial of how Melco can run casinos in less saturated markets while maintaining a high-end brand presence.
There’s also a strategic tilt here. The resort caters not just to locals but to regional tourists—from India to the Middle East.
One Melco executive reportedly said they expect “tourists to fly in from Mumbai as easily as gamblers used to jet from Beijing to Macau.”
There’s a geopolitical angle too. As Western operators face more scrutiny in China, Colombo—and other similar destinations—look increasingly attractive.
Not Just Sri Lanka: Eyes on Middle East, Europe, and SE Asia
Ho hinted at several new markets during his Bloomberg interview—though he stayed coy on specifics. Still, insiders say Melco is sniffing out deals in places like the UAE, Vietnam, and even parts of Eastern Europe.
Here’s what we know so far:
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Talks are ongoing with regional governments about licensing and partnerships.
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Deals will likely follow the Colombo model—joint ventures, minimal equity investment from Melco.
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Melco will prioritise locations where gaming is either newly legal or under regulatory reform.
This isn’t a one-off—it’s a blueprint.
And while Melco remains committed to Macau and the Philippines, this marks a clear attempt to rebalance the business away from China’s orbit.
Will the Numbers Add Up?
There’s always a risk when pivoting strategies, especially in a notoriously volatile industry like gaming. But Melco is clearly calculating that the upside outweighs the risk.
Let’s look at some basic numbers comparing traditional and asset-light approaches.
| Category | Traditional Model | Asset-Light Model |
|---|---|---|
| Capital Outlay (per project) | $1–3 billion | <$500 million |
| Debt Impact | High | Low to Moderate |
| Speed of Market Entry | Slower | Faster |
| Earnings from Operations | High (but volatile) | Steady (via fees/profits) |
| Risk Exposure | Concentrated | Shared |
While the asset-light model may generate lower returns per project, its scalability and stability could prove vital, especially in unpredictable markets.
The Broader Trend in the Casino Industry
Melco’s move isn’t in a vacuum. Across the industry, operators are rethinking how they grow—and how they avoid overexposure.
In the last three years:
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Las Vegas Sands sold off assets to focus on Asia.
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MGM has shifted toward online gaming and real estate deals.
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Genting has doubled down on resort partnerships instead of new full-ownership builds.
The writing’s on the wall: asset-heavy expansion might be a thing of the past.
The global casino market was valued at around $262 billion in 2023, according to Statista. But most of that growth came from new regulation zones—not old strongholds like Vegas or Macau. That’s what Melco is angling for.
And with inflation and interest rates still weighing heavily on financing, going light might be the only way forward.
What Lawrence Ho Didn’t Say… But Might Soon
Ho was careful not to reveal too much. But you could read between the lines.
He talked about growth, partnerships, and “exciting new jurisdictions.” No bombshells, but plenty of breadcrumbs.
One sentence stood out: “I think the next decade will be less about building empires and more about being smart with your chips.”
Is that a subtle dig at rivals still chasing mega-projects? Maybe. Or maybe it’s just Ho acknowledging the game has changed.
He’s clearly not interested in throwing dice and hoping. Instead, Melco seems to be playing poker—keeping its cards close, betting only when the odds are in its favour.
