A Hong Kong-listed firm that says it wants to spend as much as US$7.1 billion on a casino resort for the Pacific island of Saipan said in a filing on Wednesday that its 2014 profit stream from a Macau junket firm had fallen short of guarantees made by the vendor’s side.
Imperial Pacific International Holdings Ltd said it has received HKD10.7 million (US$1.3 million) from its investment in the profit stream of Macau junket firm Hengsheng Group. The amount fell short of the guaranteed profit share of HKD24 million for the period of January to December 2014, the firm said in a filing on Wednesday.
Imperial Pacific – which in July won a licence for a casino project on Saipan – in March 2014 closed a HKD400 million deal for 5 percent of the profit stream of Hengsheng. The agreement was based “on the assumption that the profit stream will be at least HKD24 million per year with certain conservative growth in the coming 16 years,” Imperial Pacific said in previous filings.
The vendor will now have to pay a shortfall of HKD13.3 million to Imperial Pacific “pursuant to the profit guarantee,” the company said in Wednesday’s filing.
The profit guarantee is secured by convertible notes, which have been retained by Imperial Pacific, the firm added.
Macau experienced its first-ever annual gaming revenue decline last year. The city’s gross gaming revenue (GGR) for 2014 fell 2.6 percent year-on-year to MOP351.52 billion (US$44.0 billion).
“The main drag has come from a slowdown in high-end demand across VIP and premium mass, primarily driven by weak China macro economy, and a changing political climate in China,” analysts at UBS Securities Asia Ltd said in a report this week.
Aug 07, 2020Casino operator Sands China Ltd’s the Londoner Hotel should be ready by the third quarter, but the timing on launching it will depend on a return of Macau’s tourism trade, especially the mainland...
Aug 07, 2020
Net loss posted by casino operator Genting Singapore for the second quarter of 2020, the firm's worst quarterly performance since 2010