A Cambodian court has acted to stop three Thai shareholders in casino operator Donaco International Ltd from ending the lease on the land occupied by its Star Vegas casino in Cambodia, the company has announced.
The company told the Australian Securities Exchange on Tuesday that the Banteay Meanchey Court of First Instance had granted an injunction preventing the landlord, Lee Hoe Property Co Ltd, from ending the 50-year lease.
Donaco said the landlord, a Cambodian company, was owned by the three Thai shareholders, who also hold Cambodian passports. It identified the shareholders as Somboon Sukcharoenkraisri alias Lee Bug Leng, Techatut Sukcharoenkraisri alias Lee Bug Huy and Bhuvasith Chaiarunrojh alias Lee Bug Tong.
Donaco said the landlord had threatened to end the lease on what the firm termed “contrived and spurious grounds”. The company said it had previously obtained a court injunction preventing the three shareholders from illegally competing with Star Vegas in Poipet, a city near the Thai border. The shareholders have indicated that they intend to appeal against that injunction.
Donaco also told the stock exchange it was now claiming US$190 million in damages from the three shareholders in a case it has brought before arbitrators in Singapore. The company previously claimed US$120 million in damages.
On June 1, Donaco told the stock exchange that a court in the Australian state of New South Wales had extended until November 2 an order preventing the three shareholders from selling their shares until an arbitration in Singapore was complete.
Donaco says the trio owns about 148 million shares or about 17.9 percent of the issued capital.
The trio sold the Star Vegas casino to Donaco in 2015 for US$360 million. Donaco alleges the three shareholders continue to run a neighbouring business called Star Paradise in competition with Star Vegas, in contravention of an agreement not to compete.
Donaco makes most of its gaming revenue by exploiting the patchwork approach to casino regulation in Southeast Asia. Star Vegas has drawn many patrons from Thailand, where casinos are banned. The group’s Aristo International Hotel in Lao Cai in Vietnam, near the Chinese border, draws many mainland Chinese players. Casino gambling is illegal in China except in Macau, a special administrative region.
