A special meeting of the stockholders of United States-based casino operator Empire Resorts Inc approved in principle on Wednesday – by majority vote – a deal to merge the firm with entities controlled by Malaysian gaming dynasty the Lim family.
According to previous regulatory filings by casino operator Genting Malaysia Bhd to Bursa Malaysia, the move is part of an exercise to take loss-making Empire Resorts private.
Empire Resorts owns and operates Resorts World Catskills, a casino complex in upstate New York, approximately 90 miles (144 kilometres) from New York City.
The firm also owns and operates Monticello Raceway, a horse racing facility in Monticello, upstate New York.
The shareholders also nodded on Wednesday executive compensation that “may become payable to the company’s named executive officers under existing agreements with the company,” upon conclusion of the merger.
Earlier this month, Genting Malaysia – operator of a casino complex in its home country, as well as gaming venues in the U.S., the Bahamas, the United Kingdom, and Egypt – concluded the acquisition of a 38.3-percent stake in Empire Resorts. The US$128.6-million deal had been announced in August.
Under that plan, affiliates of Kien Huat Realty III – the family trust of Lim Kok Thay, a businessman who is the controlling shareholder of the Genting group, a Malaysia-based casino and plantations conglomerate and parent of the Genting brand – were acquiring the outstanding shares held by Empire Resorts’ minority shareholders, for US$9.74 a share.
The deal would then lead to the privatisation of Nasdaq-listed Empire Resorts via a joint venture between Genting Malaysia and Kien Huat Realty III.
In October it was reported that a minor shareholder in Empire Resorts was suing the company, claiming that group’s stock had been undervalued under the terms of the privatisation bid. Genting Malaysia Bhd has said the lawsuit is “without merit”.
Empire Resorts has been loss making for several years. The company posted a net loss of nearly US$138.8 million for the financial year ended December 31, 2018.
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”China has been strengthening the control over capital flow, and the impact of that has already been reflected [on Macau’s gaming revenue trend]. There should not be any bigger impact from the new… legislation [on the mainland] … on the gaming revenue trend here”
Wilfred Wong Ying Wai
President of Macau casino operator Sands China