Casino services firm China Star Entertainment Ltd said it is buying back China Star Movie Ltd, a firm principally engaged in film production. China Star Entertainment controls Casino Lan Kwai Fong (pictured) on the Macau peninsula.
The subsidiary had been sold in April to Dance Star Group Ltd for HKD4.3 million (US$559.576). China Star Entertainment is now paying HKD8.7 million in cash to Dance Star, the value of China Star Movie’s net assets as of October 7, the firm said in a filing to the Hong Kong Stock Exchange on Tuesday.
Dance Star is a subsidiary of China Star Cultural Media Group Ltd, a company that until Tuesday was chaired by Heung Wah Keung, also known as Charles Heung. He is chairman of China Star Entertainment and holds about 32.3 percent of the company’s entire issued share capital.
The resignation of Mr Heung as chairman of China Star Cultural was given as the reason behind the deal.
“With Mr Heung’s resignation as an executive director of China Star Cultural … the directors consider that the interests of the China Star Cultural group would be better served by re-allocating and focusing its management and other resources to its other business segments,” said the filing.
Mr Heung is said to have resigned due to other business commitments “which require more of his dedication”.
China Star Entertainment said in August it wanted to focus its operations on gaming in Macau. The Hong Kong-listed company disposed of several non-gaming subsidiaries in the half year to June 30, including China Star Movie.
Last month, shareholders of China Star Entertainment approved the issue of new shares to raise cash to invest in the gaming-related businesses in Macau.
The firm is stepping up its exposure to the gaming industry in Macau, namely through profit-sharing arrangements with VIP junket operators. It is preparing to buy an equity interest in the profit stream from Macau junket operator Eight Elements Entertainment Ltd and entered into loan agreements with three junket operators earlier this year.
In Tuesday’s statement however the firm said the acquisition of China Star Movie would enable the group to continue the “development of its already well established film production business alongside its other principal businesses such as the hotel and gaming services operation and other gaming related services businesses in Macau”.
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Summit Ascent, lead developer of Tigre de Cristal