What would grow to become the first-ever casino listed on the Hong Kong Stock Exchange and go on to make its founder a billionaire, Cambodia’s largest casino, NagaWorld – which turned 20 years old last week – came from much more humble beginnings, as a boat moored on the Mekong River.

The predecessor to NagaWorld, Naga Casino Resorts, opened for business on May 1, 1995. The floating casino was originally intended to provide cash for its ambitious owner’s main project in Sihanoukville, and lawlessness proved no barrier for its investors or punters.

“There were incredible amounts of money flying around, $20,000 to $30,000 bets,” recalled George McLeod, who gambled on the ship when he arrived in Phnom Penh as a backpacker in 1995.

McLeod, 17 years old at the time, remembers walking the gangplank onto the ship, passing through metal detectors and guards calling for guns and grenades to be checked in at the door, before entering a gambling den that was a stark contrast to the poverty and crime-ridden streets onshore.

“Everyone there had lots of money, but were terribly dressed in shorts and t-shirts and waving around thousands of dollars,” he said.

Through an at-times tempestuous two decades that have seen their share of controversy and accusations of corruption, the ship morphed into a Phnom Penh-based project that has heralded unprecedented levels of wealth for its founding father, Malaysian businessman Dr. Chen Lip Keong and its shareholders.

Today, NagaWorld is a cash cow: its parent company NagaCorp earned $381.4 million in revenue last year, almost a third of that profit, and has a market capitalisation of more than $1.55 billion.

The casino listed on the Hong Kong Stock Exchange in 2006, three years after it moved from the river to the mainland.

But in the tumultuous years of the 1990s, the casino was an entirely different beast.

Despite its lucrative earnings – the floating casino was already profitable by 1996 – the operation was not the primary goal of Ariston, a Malaysian-owned company headed by Chen Lip Keong.

The businessman set up Ariston in Cambodia with the intention of developing a massive $1.3 billion dollar project to turn Sihanoukville’s coast into a gaming and leisure powerhouse.

The deal had incredibly favourable terms.

In 1995, upon agreeing to make a $3 million cash payment to the government – the first installment of $103 million to be paid over the next 13 years – Ariston gained an exclusive right to operate casinos nationwide for 20 years, and was exempt from paying profit taxes on its casino activities for eight years, after which it was to begin making fixed-obligation payments to the Ministry of Economy and Finance.

The deal roiled some politicians.

Eight MPs signed a letter requesting the government to explain if the deal from Ariston and other Malaysian companies violated constitutional articles on state assets. Meanwhile, the floating casino was approved by the Cambodia Development Council before the Ministry of Tourism could complete a tender process for developments on Naga Island off the coast of Sihanoukville, reportedly outraging the tourism minister and causing Hyatt International to back out of the bid.

Amidst the turmoil, Ariston itself complained that Cambodia’s lack of any gaming law meant other casinos sprouted across Cambodia, rendering its exclusivity rights meaningless.

“It’s no bed of roses,” Chen Lip Keong told reporters in 1996, saying that Ariston “could no longer be very civil and polite” about the red tape and politicisation surrounding the deal.

But as its Sihanoukville project floundered due to disputes with local land management officials, Ariston’s floating casino thrived and moved ashore.

By 2005, Ariston had sold off its Sihanoukville assets and managed to extended its monopoly deal - which had been renegotiated to a 200 kilometre radius of the capital - an extra 20 years to 2035.

In 2013, Chen Lip Keong, NagaCorp’s majority shareholder, appeared on Malaysia’s Forbes list with a net worth of more than $1 billion, largely thanks to NagaWorld, although his worth was revised down to $750 million in 2015.

Much of its success lies in its negotiated perks with the government, which have survived during a massive boom in the Asian gaming market.

“NagaWorld’s effective tax rate of less than 2 per cent of its revenues makes it very competitive against its regional peers and must be one of the factors that has contributed to its success,” said Lorien Pilling of Global Betting and Gaming Consultants.

NagaWorld’s taxes ran at about $325,000 per month last year, a total of less than $3.89 million on the back of revenues totaling $381.4 million.

NagaWorld had revenue of $381.4 million last year. Hong Menea

But for some, NagaWorld has been given too much leverage.

“Nagaworld was able to obtain a special licence to solely operate in Phnom Penh because it bribed senior government members in the Council of Ministers, in the Ministry of Tourism and the Ministry of Finance,” said Son Chhay, opposition Cambodia National Rescue Party politician.

In 1999, Chhay accused Ariston of paying $1 million to senior government members so they could avoid the impending ban on all casinos in the city. Ariston dodged the bullet, suing the city and becoming the capital’s only casino.

Today, Chhay says NagaWorld has to pay its dues, to the tune of: “at least $30 million in taxes” per year.

But others say Naga needs the low taxes to survive.

“While I’m sure there are complaints about the sweetheart deal, they need this to compete,” said Grant Govertsen, managing director of Union Gaming Research in Macau.

The cost of attracting high-rolling Chinese clients rises from about 45 cents on the dollar for Macau to 75 cents for NagaWorld, largely due to its little-known location, he said.

But Govertsen remains bullish on the project, citing its attractive facilities, regional location and the increase in Chinese VIP clients thanks to a corruption crackdown in the mainland.

He added that the NagaWorld saga was more than just a financial success for the Kingdom.

“I think the country owes a debt of gratitude to Naga for operating in a transparent manner, and getting overseas investors much more comfortable with Cambodia,” he said.