Melco Eyes Asset Divestment to Cut Debt and Fund Macau Growth

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Analyst David Bain of Texas Capital Securities values a potential sale of Melco Resorts & Entertainment Ltd’s stake in City of Dreams Manila at about US$600 million, a sum he argues could reduce Melco’s net leverage to roughly 3.5 times by late 2026 and free capital for higher-return opportunities, per GGR Asia.

City of Dreams, Manila dome with asset divestment
Image: City of Dreams, Manila

Key Takeaways:

  • Melco’s potential asset divestment of City of Dreams Manila could raise $600 million
  • Proceeds may lower net leverage to 3.5x by late 2026
  • Strategic review includes assets in Cyprus and Thailand, possible Macau acquisition

Asset Divestment Under Review

The estimate rests on current EBITDA and asset multiples and reflects Manila’s mix of VIP and mass gaming, which has kept revenues resilient even as new competitors enter the market. 

Some industry watchers, however, flag softer near-term performance: Belle Corp reported a double-digit decline in gaming revenue from its City of Dreams Manila interest in the first nine months of 2025, underscoring uneven local dynamics. 

Seaport Research Partners has gone further, urging Melco to sell Manila and Cyprus assets to fund moves in Thailand and a possible full Studio City acquisition in Macau.

Melco has formally opened a review of City of Dreams Manila and engaged CBRE Capital Advisors and Moelis & Company to advise, but “there is no assurance that the exploration will result in any transaction,” the company said in a statement. 

Analysts point to City of Dreams Mediterranean and the new Sri Lanka opening as lower-capital, high-return projects that complement a Macau-focused strategy, while some investors await clarity on valuation and Melco’s aim to resume dividends by the end of 2026.