Hong Kong-listed real estate developer Lippo Ltd says it is in talks with U.S.-based casino group Caesars Entertainment Corp on issues including Lippo possibly selling its stake in a proposed gaming joint venture in Incheon, South Korea.
“In light of the current outlook for the gaming industry in North Asia and the volatility of the global economy, the group is in discussions with Caesars for some alternatives which may include the possibility for a third party investor to acquire the group’s interest in the project,” Lippo said in a filing on Tuesday to the Hong Kong Stock Exchange.
Lippo said that even if it does decide to divest its interest in the scheme, it might still participate in “certain developments” relating to the project, subject to conditions being agreed.
“However, it is to be noted the company has no interest in participating in any gaming aspect of the project in any event,” added Lippo.
GGRAsia attempted to contact Caesars for comment but no reply had been received by the time this story went online.
Gaming for the venue was slated to be managed by Caesars. Gary Loveman, a former chairman of the firm, had said the company was working to open the resort before the 2018 Winter Olympics, due to be held in South Korea.
In December 2014, GGRAsia reported that a consortium including Caesars Korea Holding Co LLC, a U.S. firm wholly owned by Caesars, and Lippo Worldwide Investments Ltd, a unit of Lippo Ltd, made a conditional deal to acquire the land for a casino project at Incheon for just under US$95.9 million.
The other partner in the LOCZ Korea Corp consortium was reported to be OUE International Holdings Pte Ltd, a Singapore company that is wholly owned by Singapore real estate firm OUE Ltd.
In March 2014, business news outlet Reuters reported that the equity allocation between the consortium partners would be 40 percent from Caesars, 40 percent from OUE and 20 percent from Lippo Group.
Lippo Ltd is the controlling shareholder in OUE Ltd according to the latter’s annual report for 2014 filed to the Singapore Stock Exchange in April 2015.
The Incheon project was described in a March 2014 filing by OUE Ltd to the Singapore Exchange as a KRW855-billion (US$739.2-million) scheme with gross floor area of more than 150,000 square metres (1.61 million square feet) on a 4.3-hectare (10.6-acre) site.
According to a February note from Union Gaming Securities Asia Ltd, construction for the project has not yet started. Analyst Grant Govertsen said at the time there were “uncertainties currently associated” with the project.
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