Genting Malaysia plans to inject $20 million into its struggling Empire Resorts subsidiary, operator of New York’s Resorts World Catskills casino hotel.
The funds will be generated through an offering of preferred stock purchased by a subsidiary of Genting Malaysia, which is a separately traded company (GENM) controlled by the Malaysia-based Genting Group resort conglomerate.
In a filing with the Bursa Malaysia, GENM said the funds are earmarked for Empire’s working capital needs and to complete f a short-term refinancing plan.
“The equity injection will also allow GENM to continue securing its position to participate in the prospects and future growth of Empire and the potential expansion of sports betting opportunities within the state of New York,” the filing said.
Empire was a publicly traded company on the New York Stock Exchange with Genting Group Chairman Lim Kok Thay as majority shareholder when it opened Resorts World Catskills in February 2018. It was the last and most expensive of New York’s four upstate commercial casinos. But the property has significantly underachieved in terms of revenue in a statewide market saturated with gaming options.
Its struggles forced Empire early in 2019 to close the racino it operated at nearby Monticello Raceway. But, by that summer, the company’s ongoing financial woes had it headed for U.S. Bankruptcy Court. To prevent it, Lim stepped in and engineered a reorganization that took Empire private as part of a joint venture under the auspices of Genting Malaysia, with Empire continuing as owner-operator of RWC and Monticello.
When the Covid crisis hit last year, it threw another wrench into the works, GENM said in explaining the latest cash infusion, severely disrupting RWC’s operations, the company said, and further straining Empire’s liquidity position.
