The tiny island nation scrapped a ban on casinos last year in a move to shake off its staid image and capture part of Macau's success as a gambling center for Asia's increasingly wealthy and mobile middle class.

Las Vegas Sands Corp, the world's largest gaming operator by stock market value, beat three other bidders with a promise to invest S$3.85 billion ($2.4 billion) in the project, on top of the S$1.2 billion price tag for the land in downtown Singapore.

"Sands had submitted the best overall proposal that meets the economic and tourism objectives of Singapore," Deputy Prime Minister S. Jayakumar told a news conference on Friday, adding that Sands' proposal had the highest investment value.

By 2015, the government expects the Marina Bay resort to add S$2.7 billion to the economy, or 0.8 percent of gross domestic product (GDP), and create 30,000 jobs.

A government panel chose the group from four consortiums, which included top casino firms Harrah's Entertainment Inc and MGM Mirage and their local partners.

Sands will have a 30-year concession to run the casino, part of a 20.6 hectare (50.9 acre) waterfront redevelopment also featuring conference halls, performance venues and a hotel.

Sands, which runs the Venetian in Las Vegas and a Macau casino, said in April it may raise as much as $1.44 billion in a share sale or up to $3.24 billion in debt to fund the project.

The company, which was advised by Singapore property firm City Developments Ltd, has already unveiled a design by Massachusetts-based architect Moshe Safdie that is inspired by decks of cards leaning against one another.

Shares of Sands rose 5.2 percent to $67 in pre-market trading on the Inet electronic brokerage system.

TOURISM BOOST

Sands said in a statement it was "honored" to be chosen and that its experience in meetings and conventions would "produce a steady and predictable flow of visitors to Singapore."

Shares of Singapore property developers CapitaLand and Keppel Land, who were among the failed bidders, had surged by as much as 7 percent ahead of the announcement.

CapitaLand and its US partner Mirage said they were "disappointed" to learn of the government's choice. CapitaLand said it would push ahead with a proposal for the second casino with Bahamas-based Kerzner International.

The casino is an important part of Singapore's strategy to boost its tourism and services sector by tapping into the $13 billion expected to be generated in revenues from legal casinos in the region this year.

"They will bring in high-end tourists who will spend not only in the casinos but in other locations. Singapore will see higher passenger arrivals and better retail sales," said Centennial Group economist Manu Bhaskaran.

Singapore lifted its decades-old ban on casino gambling last year despite vociferous opposition from religious and social groups. But the government will levy an entry fee for locals to discourage them from gambling.

Several prospective candidates for the first casino have fallen by the wayside since Singapore invited bids last year.

Las Vegas casino impresario Steve Wynn slammed Singapore bureaucrats for micro-managing areas such as design and withdrew his Wynn Resorts from the race in December.

An alliance between Macau's casino king Stanley Ho and Publishing & Broadcasting, controlled by Australia's Packer family, pulled out in January, citing high capital costs, including an upfront land cost of S$1.2 billion ($760 million).

Proposals for the second casino, slated for the resort island of Sentosa, are due in October.

(Additional reporting by Jan Dahinten and Mia Shanley)
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