Lawrence Ho and other investors add cash to Russian project

Jul 16, 2014 Newsdesk Latest News, Rest of Asia, Top of the deck  

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Investors in a casino project in Primorye in the Russian Far East – including two Hong Kong-listed firms controlled by Macau casino developer Lawrence Ho Yau Lung (pictured) – have pledged an additional US$137.7 million to the scheme.

The money will be injected into Oriental Regent Ltd, a Hong Kong registered entity, by the way of shareholder convertible loans.

Summit Ascent Russia Ltd, a British Virgin Islands firm wholly owned by Mr Ho’s firm Summit Ascent Holdings Ltd, will invest an additional US$82.6 million. Firich Investment Ltd, a Mauritius-incorporated firm, will pay a further US$27.5 million, while Elegant City Group Ltd, a BVI entity, will pay US$20.7 million, and New Crescent Investments Ltd, a BVI firm that is a wholly-owned subsidiary of Melco International Development Ltd, a Hong Kong-listed firm chaired by Mr Ho and a partner in his Macau casino investments, will pay US$6.9 million.

Under a deal first announced in June and now completed, Summit Ascent’s equity interest in the Russian complex was also increased from 46 percent to 60 percent.

In the same deal, Firich Enterprises Co Ltd, a Taiwan-listed maker of electronic gaming machines and the parent of Firich Investment, enlarged its stake from 19 percent to 20 percent, while Melco International Development Ltd retained a 5-percent stake in the project via the subsidiary.

The Russian casino resort complex, located near the port city of Vladivostok, is expected to have 119 hotel rooms, 800 slot machines, 25 VIP gaming tables, 15 mass market baccarat tables and 25 mass market tables providing other table games. The casino is targeted to open in the last quarter of this year, Summit said in previous filings.

In September last year, Mr Ho pledged to invest US$700 million in the gaming resort, signing a deal with the Russian authorities.

But in November Summit Ascent confirmed to the Hong Kong bourse that Russian partner Oleg Drozdov, who controls Elegant City, had been arrested by Russian police. Summit Ascent said it was for “suspected business malpractices unconnected with the casino project”.

In a further filing in April this year, Summit Ascent said that the “unexpected detention of Mr Drozdov has created unforeseen financing constraints in respect of the project”. In the same filing, the company announced the deal to acquire part of Mr Drozdov’s participation in the casino resort as a way to “resolve those constraints”.

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