GGRAsia – Uy open to selling some assets if ‘makes sense’: report

Uy open to selling some assets if ‘makes sense’: report

Aug 26, 2022 Newsdesk Latest News, Philippines, Top of the deck

Philippine entrepreneur Dennis Uy is open to selling off some assets of its conglomerate Udenna Corp if they “are attractive” to outsiders, and it “makes sense” from his side, reported Bloomberg on Friday, citing the businessman. The move would be done for the group to be able to pay its debt.

“We should’ve raised equity, which we planned in 2020, but we made the decision that debt is cheaper,” said Mr Uy in an interview with the media outlet, adding he should have brought in strategic partners to support the group’s expansion.

The group has already announced plans to open to outsiders, investment in its assets. Philippine casino developer Bloomberry Resorts Corp had stated in May that it had signed an initially non-binding agreement to invest in a unit of Mr Uy’s PH Resorts Group Holdings Inc.

PH Resorts is developing a gaming venue in the holiday destination of Cebu in that nation, and has another project earmarked for Luzon island’s Clark, a growing hub for casino resorts.

GGRAsia has contacted Bloomberry Resorts, led by Enrique Razon, to ask if there is any further progress on its possible investment in PH Resorts’ unit.

PH Resorts said in its second-quarter results on August 15 that “due diligence” was “ongoing” regarding the deal. The same narrative was relayed by Bloomberry Resorts during an August 18 investor event.

PH Resorts stated in its August 15 filing that as of June 30, its current liabilities exceeded its current assets by PHP10.66 billion (US$190.2 million).

“These conditions indicate that a material uncertainty exists that may cast significant doubt on the group’s ability to continue as a going concern,” noted the filing, a warning also mentioned for the first quarter.

In July, Udenna said it had settled a US$4-million obligation related to a unit of PH Resorts.

Emerald Bay Resort and Casino in Cebu is likely to be “completed in the first quarter of 2023,” PH Resorts had said in its first-quarter results.

In the interview with Bloomberg, Udenna president Raymundo Martin Escalona said the parent group “expanded too fast in the past.”

“The only reason we did that was that there was a very strong belief that the economy will improve,” he reportedly said. Mr Escalona is also president and chief executive of PH Resorts.

Reuters reported on May 12 – citing the latest available information from a corporate regulator – that Mr Uy’s Udenna had seen what the news outlet termed its “total liabilities” rise to PHP254 billion – about US$4.53 billion at current exchange rates – in 2020, from PHP171 billion in 2019.