GGRAsia – Suncity seeks US$200mln for Manila bypassing stockholders

Suncity seeks US$200mln for Manila bypassing stockholders

Nov 26, 2019 Newsdesk Latest News, Philippines, Top of the deck

Alvin Chau Cheok Wa (pictured), the controlling shareholder of Suncity Group Holdings Ltd, wants the firm to make a US$200-million right-of-use payment to develop a casino resort on land near Manila Bay in the Philippine capital, without waiting to call a general meeting of stockholders as would normally be required under Hong Kong Stock Exchange rules for such a payment.

“If the waiver is granted, the project site payment will be approved by way of written approval of the controlling shareholder. Otherwise, the project site payment will have to be approved by way of shareholders’ approval at a general meeting of the company,” stated Monday’s filing after trading hours.

The payment would be to Westside City Resorts World Inc, which is a 95-percent non wholly-owned subsidiary of Travellers International Hotel Group Inc. The latter is in turn a venture between Philippine conglomerate Alliance Global Group Inc and casino cruise ship operator Genting Hong Kong Ltd.

Upon payment – likely to be “on or before” January 31, 2020 – the asset would be held by Philippine-listed Suntrust Home Developers Inc, which is a 51-percent subsidiary of Suncity Group Holdings.

As of the date of the announcement, Philippine-listed Megaworld Corp held a 12.79 percent interest in Suntrust, and Travellers International and the Westside entity were respectively associates of Megaworld.

Monday’s filing said the cash consideration for the asset was based on a “preliminary valuation of an independent valuer” that the project site was worth US$340 million, and took into account also “costs incurred and construction work performed on the project site”.

It had previously been anticipated that Travellers International – which already controls the Resorts World Manila casino complex at Newport City near Manila International Airport – might independently develop the site under discussion.

In early November Suntrust said in a filing it would “build and operate its hotel and its areas of the casino” on the project site, that has previously been referred to as “Westside City Resorts World”, and before that, “Bayshore City Resorts World”.

The new venue – under the working title “Westside City Resorts” – is to start operations “by fourth-quarter 2022”, Suncity Group Holdings told GGRAsia soon after an initial announcement to the Hong Kong bourse.

The complex will be located within Entertainment City, which comprises in whole a 120-hectare (297-acre) zone of reclaimed land in Metro Manila. Entertainment City as a whole is being marketed by the Philippine authorities as a casino cluster meant to emulate the success of Macau’s Cotai district.

Suncity Group Holdings’ initial plan for the Manila scheme – mentioned in a Hong Kong filing in late October – includes total gaming capacity of 400 tables to serve the VIP and mass markets, and 1,200 slot machines. It also features 400 five-star hotel rooms, a car park, and “non-gaming facilities themed around pool-side parties featuring a high-end pool club”.

The firm has not publicly disclosed an overall budget for the casino hotel project.