Donaco International Ltd, a boutique Australia-listed operator of casinos in Indochina, says it is seeking consent from Mega International Commercial Bank Co Ltd so that Donaco can “fulfil parts of the settlement agreements” it has arranged with the Thai vendors of the Star Vegas Resort and Club property (pictured).
Such settlement was announced earlier this month. As part of the deal, Donaco has agreed to remove non-competition and non-solicitation clauses regarding its Star Vegas business, and in return will get US$38 million from the vendors’ side.
“To date, the settlement parties have submitted withdrawal requests to the relevant courts and authorities,” said the firm in its latest filing to the Australian Securities Exchange, referring to outstanding legal and arbitration matters between Donaco and the Thai vendors.
“The company is awaiting judgment from courts and confirmation from authorities to fulfil the conditions stated in the settlement agreements,” it added.
The settlement with the Thai vendors stated that Donaco will have to pay US$18 million to settle the other side’s claims for unpaid management fees plus interest. Also, as part of the deal, Donaco will furnish “any outstanding rent” and an additional lease payment of US$20 million to Lee Hoe Property Co Ltd.
In the filing, Donaco said that under the group’s facility agreement with Mega Bank, the company must obtain the lender’s consent to fulfil parts of the settlement agreements. Those include the payment of any outstanding rent and US$20 million to Lee Hoe Property, and the removal of non-competition clauses in the share sale agreement.
“Donaco remains confident that Mega Bank will support the settlement reached with the Thai vendors and the continuation of the Star Vegas Casino,” stated the company.
The casino operator announced last week it was closing “most” of its Star Vegas Hotel. The announcement did not elaborate on the impact of the measure on its gaming operations at the property.
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