Genting Hong Kong Ltd – an investor in casino cruise ships and land-based casino operations in Asia – says it is selling an indirectly-held equity interest relating to a casino business on Jeju Island (pictured), in South Korea, and terminating a shareholder agreement related to it.
The disposal – to the other shareholder in the venture, mainland China property developer Landing International Development Ltd – is for a consideration of KRW130 billion (US$111.1 million).
The assets being disposed of relate to “the development, management and operation of the casino business carried out by Grand Korea in Jeju Province,” said a Genting Hong Kong filing to the Hong Kong Stock Exchange on Wednesday.
The document describes Grand Korea as a company incorporated in South Korea, operating a casino business on Jeju that is regulated by the Ministry of Culture and the government of Jeju Province.
Genting Hong Kong said the reason for the disposal is that had recently acquired Crystal Cruises LLC, a global luxury cruise line operator.
“The disposal transaction, if completed, will enable the company to focus on and put more resources to expand its cruise and cruise related businesses,” said Genting Hong Kong, adding it “will also enable the company to redeploy the cash proceeds flexibly to further explore and fund other investments and business opportunities as they may arise.”
The deadline for the completion of the transaction is December 31.
Elsewhere on Jeju, the Genting group – via Genting Singapore Plc – and Landing International Development are planning collaboration on a new casino project that has been referred to as “Resorts World Jeju”. A ground breaking ceremony for that scheme took place in February.
On July 17, Landing International Development announced the results of a rights subscription offer toward its portion of the capital costs for the new Jeju casino project. It said that the exercise raised HKD4.16 billion (US$536.7 million), adding that 63.6 percent – or just under 12 billion – of the approximately 18.7 billion subscription rights shares at HKD0.35 each had been taken up by investors.
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”We expect Goa to quickly become a US$1 billion market as it transitions to land-based casinos (from US$150 million today), which is still just a fraction of India’s total GGR potential of US$10 billion to US$17 billion”
Analyst at Union Gaming Securities Asia