Asian casino investor Lawrence Ho Yau Lung (pictured) is selling off his stake in Summit Ascent Holdings Ltd, the lead developer of the Tigre de Cristal casino resort in the Russian Far East.
The businessman plans to sell 20 million shares in Hong Kong-listed Summit Ascent – representing a stake of approximately 1.34 percent – thereby ending his role as a direct shareholder in the company, according to a Monday filing by the firm made to the Hong Kong Stock Exchange.
In addition, Quick Glitter Ltd – an entity wholly owned by Mr Ho – also plans fully to liquidate its position in Summit Ascent. Quick Glitter owns approximately 238.6 million shares of the casino developer, equivalent to a stake of 16.03 percent of Summit Ascent’s issued share capital.
“The board has been informed by Mr Ho – the chairman, non-executive director and a substantial shareholder of the company – that on December 15, 2017, Mr Ho and a company wholly owned by him, Quick Glitter, entered into a placing agreement with the placing agent, pursuant to which Mr Ho and Quick Glitter agreed to sell the placing shares… at a price of HKD1.05 [US$0.13] per placing share,” Summit Ascent stated in Monday’s filing.
The placing agent was identified as Sun Hung Kai Investment Services Ltd, a Hong Kong-based brokerage. Completion of the placing is expected to take place on or before December 20, the document added.
“Immediately following completion of the placing, Mr Ho and Quick Glitter will cease to hold any shares in the company,” the filing added.
According to Summit Ascent’s 2017 interim report, Mr Ho was the largest shareholder of Summit Ascent as of June-end, with a stake of 27.71 percent (including Quick Glitter’s shares in the company). Deputy chairman John Wang was the second largest shareholder, with a 10.84-percent stake in the company.
The document did not say why either Mr Ho or Quick Glitter sought to sell their respective holdings in Summit Ascent.
This is the second time in fewer than four months that Mr Ho has moved to reduce his position in Summit Ascent. In September he significantly reduced his position in the company.
Commenting on Mr Ho’s decision to sell his remaining stake in Summit Ascent, brokerage Union Gaming Securities Asia Ltd said in a Monday note that a “confluence of factors” was keeping the Vladivostok market from reaching its full potential.
According to analyst Grant Govertsen, the headwinds included: “the potential for the gaming tax (a per device fixed fee) to double next year, and potentially increase by a factor of 10 times over the next several years; numerous illegal gaming venues in closer proximity to the population base remain an impediment to the high-margin mass market story; and given the above, the likelihood of the [Summit Ascent’s] phase 2 project (and the other peer ground phase 1 developments) becomes diminished by the day.”
Summit Ascent is a majority investor in the Tigre de Cristal casino resort in the Primorye region of Russia. The firm posted a loss of HKD5.4 million for the first half of 2017, compared to a profit of approximately HKD5.5 million a year earlier.
Phase one of Tigre de Cristal opened in autumn 2015. The resort is currently the only casino property in operation in Primorye.
Summit Ascent said in August that it expected to open the first stage of Phase II of its Tigre de Cristal property “in the second half of 2019”.
Hong Kong-listed casino operator and developer NagaCorp Ltd had a ceremony to break ground on its Primorye site in May 2015. The company has more recently said it aims to open the property in the first half of 2019.
Diamond Fortune Holdings Ltd began earlier this year ground preparation for its first casino resort in Primorye. The firm has said it plans to open the first stage of the project – named Selena World Resort and Casino – in 2019.
Feb 16, 2018Due to the Chinese New Year holiday, the GGRAsia team will be off between February 16 and 19. We will be back on February 20. We wish all our readers a prosperous Year of the Dog!
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