Bloomberry Resorts Corp., the operator of Solaire Resort and Casino in Entertainment City, on Thursday said it has disposed of its South Korean gambling assets to Iao Kun Group Holding Co. Ltd., a move that is seen mitigating the firm’s revenue losses.
In a disclosure to the Philippine Stock Exchange, the Razon-led company, said it has disposed of its stake in Solaire Korea Co. Ltd., which owns 93.23 percent stake in Golden and Luxury Co. Inc. (G&L), the unit that operates Jeju Sun Hotel and Casino in Jeju Island in South Korea.
In the first quarter of the year, Bloomberry Resorts Corp. incurred a higher net loss of P1.15 billion versus the P533.05 incurred in the same period last year, dragged mainly by the Korean operations, lower VIP hold rate, foreign exchange losses.
Of the net loss, P209 million was sustained from its South Korea operations in Jeju Island.
Prior to its announcement, rumors were circulating that the Razon group had been wanting to dump its gambling interest in South Korea in order to mitigate its losses and eventually swing back to profit.
“The agreement is subject to several conditions including the satisfactory results of a due diligence that Iao Kun will conduct on the shares to be sold, G&L, and its assets and business. It is also subject to the approval of other government authorities,” the company said.
It said the purchase price is 117.5 billion Korean won or about P4.74 billion.
There will be a KRW 4 billion holdback as security for contingent liabilities up to 22 October 22, 2017, it said.
“Iao Kun desires to enter into the Jeju market and is confident that it can attract its’ Chinese VIP customers to Jeju Island. Solaire Korea, on the other hand, intends to focus its effort on the development of its property in Muui and Silmi Islands,” Bloomberry told the local bourse.