GGRAsia – SPAC partner in Okada Manila listing sues Universal Ent side

SPAC partner in Okada Manila listing sues Universal Ent side

Feb 07, 2023 Newsdesk Latest News, Philippines, Top of the deck

United States-listed 26 Capital Acquisition Corp is suing Tiger Resort, Leisure and Entertainment Inc – the promoter of the Okada Manila casino resort (pictured in a file photo) in the Philippine capital – urging the prompt consummation of a previously-announced merger between the two sides.

Japanese conglomerate Universal Entertainment Corp said in a Tuesday statement that a lawsuit against its subsidiaries UE Resorts International Inc and Tiger Resort, Leisure and Entertainment, as well as two other units, had been filed on February 2 in the U.S. state of Delaware, by 26 Capital.

“The company will scrutinise the lawsuit and properly deal with it,” Universal Entertainment stated. “The company will promptly announce progress that should be disclosed.”

Universal Entertainment announced in October 2021 a merger agreement involving 26 Capital, which would result in Okada Manila becoming a publicly traded company listed on Nasdaq. The 26 Capital entity is a special purpose acquisition company (SPAC) listed on the Nasdaq stock market in the United States.

The 26 Capital entity is led by Jason Ader, founder of investment management firm SpringOwl Asset Management LLC. Mr Ader served between 2009 and 2016 as an independent director at U.S.-based casino operator Las Vegas Sands Corp.

The merger and subsequent listing operation was initially expected to be completed by the end of June 2022. However, it was delayed several times, against the backdrop of what Universal Entertainment claimed was an “illegal” occupation between May 31 to September 2, 2022 of Okada Manila, when people acting on behalf of the resort’s ousted founder, Kazuo Okada, first occupied and then ran the property.

In its latest filing, Universal Entertainment stated that, “while the deadline of the merger agreement has been changed to September 30, 2023… 26 Capital has requested the court to declare that the [Universal Entertainment] subsidiaries have breached the obligation to consummate the merger promptly under the merger agreement.”

In addition, stated Universal Entertainment, 26 Capital is also asking the court to require the Japanese side’s “subsidiaries to consummate the merger promptly”.

In September 2022, when announcing that the deadline of the merger agreement had been changed to September 20, 2023, Universal Entertainment said that it intended “promptly” to carry out the merger, “even prior to the deadline, once the environment to do so is in place.”

Casino gross gaming revenue at Okada Manila for the three months to December 31, 2022 was nearly PHP10.50 billion (US$191.9 million), from PHP7.01 billion in the prior-year period, while full-year GGR was PHP34.34 billion, from nearly PHP18.92 billion in 2021, according to Tiger Resort, Leisure and Entertainment.