Lippo considers selling interest in Korean-casino project

By
macaubusinessdaily

Property developer Lippo Ltd. is considering withdrawing from its joint casino project with US-based gaming operator Caesars Entertainment Corp. in Incheon, South Korea by selling its interest in the project, according to its filing with Hong Kong Stock Exchange yesterday.
The developer announced yesterday that the two companies – which obtained a conditional deal to acquire a land plot for the casino project with the vendor MIDAN City Development Co. Ltd. in 2014 – had failed to make the deal unconditional before the deadline on December 31 although the deal has not yet been terminated by any of the parties.
Claiming there is no certainty as to whether a final licence [for the project] would be granted, coupled with the ‘current outlook for the gaming industry in North Asia and the volatility of the global economy’ Lippo said it is in discussion with Caesars ‘for some alternatives which may include the possibility for a third party investor to acquire the Group’s interest in the project.’
The company also stated that it has no interest in participating in any gaming aspect of the project in any event despite still considering participating in certain development related to the project land plot if the land deal could be satisfactorily resolved.
Last December, the Hong Kong-listed developer released two filings saying the Korean casino project was clouded with ‘uncertainties’ as their consortium had not mutually agreed on all the conditions in their conditional land sale and purchase agreement with MIDLAND – which is indirectly owned by Lippo.
The consortium, named LOCZ Korea Corp., was given the green light by the Ministry of Culture, Sports and Tourism of the Republic of Korea to design, develop, construct and own the gaming project in Incheon in March 2014.
It comprises Lippo’s wholly owned subsidiary Lippo Worldwide, partly-owned OUE International, and Caesars Entertainment’s subsidiary Caesars Korea.
The parties planned to invest 743.7 billion won (HK$4.92 billion/US$61.3 million) in the first phase of the project by 2018 and a total of 2.3 trillion won for the whole project, to include a foreigner-only casino, hotels, residential buildings, convention centres and shopping mall. K.L.