GGRAsia – HK-listed Suncity to pay US$77 mln for Vietnam casino stake

HK-listed Suncity to pay US$77 mln for Vietnam casino stake

Jul 28, 2017 Newsdesk Latest News, Rest of Asia, Top of the deck

Hong Kong-listed Suncity Group Holdings Ltd is to acquire a 34-percent stake in a casino project in Vietnam for a total consideration of HKD600 million (US$76.8 million), the firm said in a filing on Thursday.

The purchaser is Goal Summit Ltd, a wholly-owned subsidiary of Suncity Group Holdings, a company chaired by Macau junket investor Alvin Chau Cheok Wa. The seller is Suncity International Holdings Ltd, a British Virgin Islands company wholly owned by Mr Chau, according to the filing.

Under the acquisition agreement announced on Thursday, the purchaser intends to acquire 50,000 shares in Star Admiral Ltd – representing the latter’s entire issued share capital – as well as the latter’s obligations, liabilities and debt.

The aggregate consideration for the deal shall be satisfied by the issue of a promissory note and convertible bonds by Suncity Group Holdings in the principal amount of, respectively, HKD303 million and HKD297 million.

The exercise will offer investors in Suncity Group Holdings some exposure to a casino project in Hoi An, Vietnam. The casino property is being promoted by Hoi An South Development Ltd, a venture that also involves Vietnam-based asset management firm VinaCapital Group and a subsidiary of Hong Kong-based Chow Tai Fook Enterprises Ltd.

As of the date of Thursday’s announcement, Hoi An South Development had invested a total of approximately US$89.0 million in relation to the first phase development of the scheme. The whole development is expected to comprise seven phases, with the first phase including a casino with a total of 140 gaming tables and about 1,000 slot machines, a golf course, hotel rooms and suites, and a condo-hotel.

Suncity Group Holdings said on Thursday that the first phase of the Vietnam project is expected “to be completed on or before mid-2019”.

“The group is confident on the outlook [of] the tourism sector in Vietnam and believes there will be an increasing demand for resort facilities in popular tourist destinations [in] the country, including Quang Nam province, which has received almost a quarter of the country’s total number of foreign visitors in 2016,” said the Hong Kong-listed firm.

A June company announcement said the investment opportunity in the Vietnam project had been introduced to Mr Chau by Andrew Lo Kai Bong, one of the executive directors of Suncity Group Holdings.

“As consideration for his services, Mr Chau agrees to procure the vendor to pay Mr Lo a certain percentage of the realised profit of the vendor upon realisation or disposal of its interests in the project subject to a maximum amount of HKD120 million,” the Thursday filing stated.

In a recent interview with GGRAsia, Mr Lo said the Hoi An project developer would apply to be part of a local-gambler trial in Vietnam. The Vietnamese government published in January a decree that paves the way for selected domestic casinos to accept bets from Vietnamese gamblers, for a trial three-year period.