MGM China Paying MGM Resorts up to $173 Million for Trademarks

MGM China announced it will pay as much as $173.2 million over three years commencing Jan. 1, 2023 to MGM Resorts International for use of the US-based company’s trademarks.

MGM China
MGM China
The MGM Macau integrated resort. MGM China entered a trademark deal with MGM Resorts. (Image: CNBC)

MGM China, which operates two integrated resorts in Macau, said in a regulatory document it has approval to use marks including MGM, MGM Grand, MGM Grand Macau as well as the iconic MGM lion. The agreement also includes other “MGM-related service marks, trademarks, registrations and domain names” owned by the Las Vegas-based casino operator.

In addition to any expansion of MGM Macau and MGM Cotai, any future resort and casino projects or sites that the group may develop … will use the MGM brand,” according to MGM China’s regulatory filing.

MGM, which is the largest operator on the Las Vegas Strip, owns nearly 56% of the Macau unit. While MGM’s US operations are thriving, the company is taking a wait-and-see approach to large-scale investments at its two Macau venues.

Trademark Agreements Common Among Macau Operators

Of the six Macau concessionaires, three are tied to US-based parents — MGM China, Sands China and Wynn Macau. Trademark pacts are common among those entities.

For example, MGM China announced in June that it struck a deal with MGM to continue using one of the gaming industry’s most recognizable brands. Earlier this week, Sands China said it will pay Las Vegas Sands as much as $377 million over three years to continue using Sands-related trademarks in Macau.

MGM China also revealed that it will pay as much as $46.4 million in 2023 to related parties for branding services, hotel cleaning and laundry services.

Over the next three years starting in 2023, MGM China will pay $15 million annually to MGM Branding — a wholly owned subsidiary equally controlled by MGM Resorts and Pansy Ho. Ho is the co-chairperson at MGM China and recently signed a 10-year contract valued at $8 million annually to remain a managing director of the gaming entity. She’s occupied that role since 2005.

MGM China Marketing Agreement

The regulatory filing also highlights a revamped marketing agreement between MGM China and its US parent. Under the terms of that accord, the Macau entity will pay $8.34 million to MGM in 2023 for marketing services. That figure increases to $9.63 million in 2024 and $10.91 million in 2025.

Last month, MGM made a subordinated revolving credit facility of up to $750 million available to MGM China to financially support the business. Sands China and Wynn Macau made similar moves this year.

MGM China operates MGM Cotai and MGM Macau.

The post MGM China Paying MGM Resorts up to $173 Million for Trademarks appeared first on Casino.org.

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