GGRAsia – LET gets US$51mln loan, Summit Ascent shares as security

LET gets US$51mln loan, Summit Ascent shares as security

Sep 20, 2022 Newsdesk Latest News, Philippines, Rest of Asia, Top of the deck

Hong Kong-listed casino investor LET Group Holdings Ltd – formerly known as Suncity Group Holdings Ltd – has a deal for a HKD400-million (US$51.0-million) loan facility from four sources described as independent third parties.

The company made the announcement in a filing on Monday to the Hong Kong bourse.

Under the loan agreement, LET Group pledged the equivalent of approximately 69.67 percent of the total issued shares of subsidiary Summit Ascent Holdings Ltd to the lenders as security.

The lenders – not named in the filing – consist of “two individuals” and two “corporations”.

LET Group’s principle business interests include investment, via Manila-listed Suntrust Resort Holdings Inc, in the development and operation of a casino resort at the Westside City Project in the Philippine capital, Manila. That project has a price tag of approximately US$1 billion, and should start operation in 2024.

LET Group also has interest – via Hong Kong-listed Summit Ascent and its units – in a hotel and gaming business at Tigre de Cristal in the Integrated Entertainment Zone of the Primorye Region, near Russia’s Pacific port of Vladivostok.

LET Group said in late August it had defaulted on the payment of a promissory note in the principal amount of HKD303 million, and two groups of convertible bonds with an aggregate value of HKD197 million.

The note and bonds were owned by Major Success Group Ltd, a company wholly-owned by Andrew Lo Kai Bong, recently appointed chairman of LET Group.

The firm stated in its latest filing that HKD380-million of the fresh-loan funds would be used for the “full repayment of the promissory note including interest accrued thereon and for the partial repayment” of the convertible bonds.

“Upon completion of the aforementioned repayment, the remaining outstanding amount due together with interest accrued thereon under the 2018 convertible bonds will be approximately HKD226 million,” LET Group estimated.

The firm stated that the remaining balance of the loan would be utilised as general working capital of the group.

The loan announced on Monday is for a term of 12 months maturing on September 18, 2023.

“The interest rate payable under the loan is the higher of 18 percent per annum; or the aggregate of 13 percent per annum and the Hong Kong dollar prime lending rate as may be offered by the The Hongkong and Shanghai Banking Corporation Ltd from time to time, payable quarterly in arrears,” said LET Group.

The firm added: “In the event of default, the default interest rate payable under the loan would be the aggregate of the interest rate and 6-percent per annum, payable on demand.”

The filing stated that the company’s board considered the loan conditions “fair and reasonable, on normal commercial terms”. It added the move was “in the interests of the company and its shareholders as a whole”.

Last week, parties acting on behalf of a company controlled by Mr Lo agreed to meet the greatly-increased HKD0.0690 (US$0.00892) purchase price for the balance of shares in LET Group, as recommended recently by Hong Kong’s Takeovers and Mergers Panel.

A September 14 filing to the Hong Kong Stock Exchange by LET Group added that on such basis, the firm was seeking to resume trading its shares with effect from the following day, September 15. Such a step was permitted. The groups’s stock had been suspended from trading since August 12.