GGRAsia – Deal for Star Vegas Poipet faces 2-month delay: Donaco

Deal for Star Vegas Poipet faces 2-month delay: Donaco

Mar 31, 2015 Newsdesk Latest News, Rest of Asia, Top of the deck

Australia-listed boutique casino operator Donaco International Ltd said the acquisition of the Star Vegas Resort and Club casino property in Poipet, Cambodia, faces a “delay of up to two months” as the company finalises the details of a new debt facility.

Donaco said in January that it was acquiring the Star Vegas (pictured) for a consideration price of US$360 million. Donaco is currently a one-property operator, running the Aristo International casino hotel in Lao Cai, near Vietnam’s northern border with China.

The company has raised AUD132 million (US$100.8 million), excluding costs, from a share entitlement offer, Donaco’s chairman Stuart McGregor said in a presentation to shareholders at the extraordinary general meeting on Friday.

The casino operator earlier this month said it had obtained a US$100-million loan from Mega International Commercial Bank Co Ltd, a Taiwan-based lender with a “significant presence” in Cambodia and known to consumers as Mega Bank.

“Due to the need to resolve all of the conditions precedent to the satisfaction of both the company and Mega Bank, it is now expected that the transaction will complete, and the company will take possession of the Star Vegas business, by July 1, 2015,” Mr McGregor said in his address to shareholders on Friday.

He added: “This is a delay of up to two months from the originally planned time frame, but the company is determined to ensure that this major acquisition is completed on the right terms, and with all necessary matters dealt with to our satisfaction, for the benefit of our shareholders.”

The company has said the deal “will provide valuable diversification”, with the Star Vegas “focusing on the Thailand market, while the Aristo services the China market”.

Cambodia’s Phnom Penh Post newspaper, which first reported the delay, said the country’s government has not yet received any official letter about the deal.

The media outlet quoted Ros Phearun, deputy director of the finance industry department at the Ministry of Economy and Finance, saying the ministry has no power to interfere in the deal.

“We don’t have a law to manage the industry, so we cannot interfere with their deal, which why is we are going to draft a law to govern the industry,” Mr Phearun reportedly said.