GGRAsia – China Star drops Macau junket profit deal

China Star drops Macau junket profit deal

May 26, 2015 Newsdesk Latest News, Macau, Top of the deck

Casino services firm China Star Entertainment Ltd said in a filing to the Hong Kong Stock Exchange after business hours on Friday that it had “mutually irrevocably and unconditionally” agreed to terminate a deal to buy an equity interest in the profit stream from Macau junket operator Eight Elements Entertainment Ltd.

China Star runs the casino at a hotel property called Lan Kwai Fong (pictured) in downtown Macau, under a gaming licence from SJM Holdings Ltd.

Eight Elements, controlled by Protective Capital Group Ltd, is a junket operator at Casino Lan Kwai Fong. The sole shareholder of Eight Elements and its parent business is Kelvin Kam Lap Sing, according to an earlier China Star filing.

The original deal had been outlined in February 2014, but it was delayed several times.

China Star had at that time agreed to pay HKD800 million (US$103.2 million) to Mr Kam in three instalments for the rights to the profit from the Eight Elements junket operation.

“The vendor has refunded the deposits to the purchaser without interest,” China Star said in Friday’s filing.

Gross gaming revenue – mostly VIP revenue – in Macau has been negatively affected by year-on-year declines since June, leading to a more challenging environment for smaller junket operators.