Puts to rest all challenges
Despite many legal hurdles, Macau Legend Development Ltd. has completed its acquisition of the Savan Vegas Hotel and Entertainment Complex in Laos.
The company signed a deal with the Lao government in August, and took over the property September 8.
Macau Legend CEO and Co-Chairman David Chow Kam Fai said, “We sincerely thank the government of the Lao PDR for their support and trust in Macau Legend. We have a shared vision with the government on both the transformation of the existing Savan Vegas Casino and Hotel as well as development of the proposed new integrated resort by our company in Savannakhet Province.”
In May, the company agreed to pay US$42 million for the right to operate Savan Vegas. The deal also includes a 50-year monopoly on casino operations in three Lao provinces including Savannakhet, reported GGRAsia.
In a press release, Lao Minister of Planning and Investment Souphanh Keomixay said the government “looks forward to working with Macau Legend in the transformation of Savannakhet as a center for tourism.”
As recently as last month, the sale was still being challenged, not only by former owner Sanum Investments Ltd. but a group calling itself the European/Asian Consortium which offered an up-front cash payment of US$60 million, expansion capital of US$120 million, and US$220 million in guaranteed tax payments over the first 50-year period, said Werner Kubesch, leader of the consortium, which claimed to be affiliated with a global gaming operator.
Complicating matters, Sanum Investments Ltd. and its parent company, Lao Holdings NV, challenged the deal, saying it violated a 2014 agreement with the Laotian government promising “maximum value to the benefit of all parties.”
The resort development started as a joint venture between the former owners and the Laotian government. Under that structure, Lao Holdings owned 80 percent of the complex, with the rest under government control. But in 2012, the government seized the property, claiming it owed $23 million in back taxes. The dispute was settled in June 2014 when the two companies agreed to sell their interest if Laos dropped tax-dodging and criminal bribery charges against the consortium. Now the former owners say it is not getting fair value for its ownership stake in the complex, which it says is valued at $250 million.
The property on the border of Thailand and Vietnam includes “a full-service casino, a hotel and numerous entertainment and leisure offerings,” according to a statement from the firm. The hotel has more than 470 guest rooms including 23 suites. The casino has 92 tables and 493 slot machines.
Macau Legend runs the Babylon Casino at Macau Fisherman’s Wharf and Pharaoh’s Palace Casino at the Landmark Macau, both on the peninsula. The casinos are operated under the casino license of Macau gaming operator SJM Holdings Ltd., founded by Stanley Ho.
