First step to PSE listing for Tiger
Japanese pachinko king Kazuo Okada, founder of Universal Entertainment, has asked the Philippine Stock Exchange to investigate a proposed takeover of Philippine-listed investment holding company Asiabest Group International by Tiger Resort Asia Ltd., which Okada once controlled.
TRA plans to buy a majority stake—200 million shares—in Asiabest, or 66.6 percent of its issued share capital, for PHP646.5 million (US$12 million). The deal is expected to close November 12 pending approval by the Philippine Amusement and Gaming Corp., the country’s gaming regulator. It could lead to TRA’s backdoor listing on the PSE.
In a letter, Okada said he will take “the needed action to protect (his) interest” in Tiger Asia, pointing out that although he owns more than 34 percent of both Tiger Asia and Tiger Resort Leisure & Entertainment Inc., he was neither informed nor consulted about the Asiabest deal. He is now filing criminal, civil and administrative cases against those responsible for entering into what he called an “illegal” share purchase agreement.
“ABG, as a publicly listed company, should make a full disclosure of its impending sale transaction with Tiger Asia, particularly that there is a legal controversy on Tiger Asia’s authority to enter into such a transaction,” Okada complained. He promises to file criminal, civil and administrative cases against those involved in any proposed flotation.
Okada is battling to regain control of Okada Holdings, which he founded in Hong Kong in 2010 and which owns 68 percent of Universal Entertainment Corp. Universal owns 99.99 percent of Tiger Asia which itself holds a 99.99 percent stake in TRLEI. Okada was ousted from the board of all three companies in 2017 after allegations that he misappropriated company funds for his personal use. He denies the allegations.
According to Reuters, at the time of the ouster Okada’s children—son Tomohiro and daughter Hiromi—combined their shares to claim a controlling stake in the company. Later Hiromo reconciled with her father and gave him power of attorney over her 9.78 percent stake, raising his ownership 56.16 percent. Speaking as the controlling shareholder, Okada declared he would “never agree” to the Asiabest deal.
In a letter to the PSE, the billionaire’s representatives “respectfully requested your good office to order ABG to do a full disclosure of its share purchase transaction with Tiger Asia in order that the public will be fully informed, and Mr. Okada will be able to take the necessary steps to protect his interests in Tiger Asia.”
Meanwhile, Business World reports that ABG has informed PSE that its public float will drop to 6.1 percent, far below its current public ownership of 33.97 percent, after the share purchase agreement deal closes. Under the compliance plan, ABG will transfer the shares of current stockholders owning more than 10 percent of the outstanding capital stock to public investors.
“In the conduct of tender offer, stockholders owning more than 10 percent may tender their shares to decrease their shareholding to less than 10 percent in order to be considered as a public investor in accordance with the guidelines in determining public shareholders and thereby, become eligible for purposes of meeting the MPO (minimum public ownership),” the company said.
A 10 percent public float is the minimum requirement required by the Securities and Exchange Commission on listed companies. The country’s corporate regulator hopes to raise that to 20 percent to boost liquidity in the market.
Tiger Asia is the majority shareholder of TRLEI, which operates the Okada Manila integrated resort in Entertainment City. The property offers a casino with 500 table games and 3,000 slot machines; a 990-room hotel; and other attractions including restaurants and bars. The company has announced that it will open an office in Tokyo to “study the potential of a casino resort business in Japan.” That country, seen as gaming’s newest billion-dollar frontier, legalized casino gaming in 2016.
In its bid for one of the first three Japanese licenses, Tiger will join international operators including Melco Resorts & Entertainment, Hard Rock International, Genting, Mohegan Gaming, the Las Vegas Sands Corp., MGM Resorts International and Caesars Entertainment, among others.
