A U.S.-based special purpose acquisition company (SPAC) has filed suit in a Delaware court alleging that Philippines integrated resort Okada Manila and associated companies delayed a planned merger, to be followed by a Nasdaq listing of the merged entity.
Inside Asian Gaming, citing documents posted by Japan’s Universal Entertainment Corp., parent of Okada Manila, reports that 26 Capital Acquisition Corp., controlled by activist investor Jason Ader, has filed suit against Universal subsidiaries Tiger Resort Asia Ltd. (TRAL), Tiger Resort, Leisure and Entertainment Ltd. (TRLEI), UE Resorts International Inc. (UERI) and Project Tiger Merger Sub Inc.
The suit claims those entities breached their obligation to close the deal promptly under the original agreement. It also asks the court to order the timely completion of the merger. Universal said it will review the details of the suit and “properly deal with it.”
In October, UERI and 26 Capital announced a 12-month extension of the merger deadline from October 1, 2022, to October 1, 2023.
The proposed merger would make UERI a publicly traded company on the Nasdaq. TRAL, which owns 99.9 percent of Okada Manila operator TRLEI, would maintain 80 percent of the share capital.
The original agreement, signed in October 2021, assessed the total equity value of the newly formed SPAC company at US$2.5 billion. The deal was delayed last May when a group representing ousted Okada Manila founder Kazuo Okada forcibly seized control of the Manila resort. The group occupied the property for three months until the previous board regained control in September.
At the time, 26 Capital Chairman and CEO Jason Ader said, “I remain extremely excited about this transaction and the opportunity for our investors to participate in one of the fastest growing Asian gaming markets.
“The fact that Universal Entertainment is willing to extend the agreement by a year demonstrates the dedication of both parties to complete the merger.”
Asia Gaming Brief reports that, in its most recent results, Okada Manila saw a 50 percent yearly increase in gross gaming revenue in the fourth quarter of 2022, to $192.6 million, while also posting a 10 percent quarterly increase. Adjusted segment EBITDA was up 96.3 percent yearly, to $51.88 million.
