Five of six members of the Summit Ascent Holdings board of directors have quit in protest over the company’s planned withdrawal from the Russian casino market through the sale of its stake in Tigre de Cristal, an integrated resort (IR) in the Primorye economic zone.
According to Inside Asian Gaming, the Hong Kong-listed company will sell 100 percent of its shares in G1 Entertainment LLC, the operating entity of Tigre de Cristal, to a Russian company, Dalnevostochny Aktiv, for $116 million.
The plan was revealed in a January 10 filing by Firich Investment Ltd. to the Taiwan Stock Exchange.
Firich owns 20 percent of Oriental Regent Ltd., which operates gaming at the Russian resort. Summit Ascent controls 77.5 percent stake of Firich, and the LET Group, formerly Suncity, owns 69.66 percent of Summit Ascent.
On news of the sale, five Summit Ascent directors tendered their resignations effective immediately “due to their disapproval” of the transaction. They cited “inside information” related to the sale, but offered no further details.
The board members included former executive director and CEO David Chua along with Chiu King Yan, Lam Kwan Sing, Lau Yau Cheung and Li Chak Hun. Three LET Group directors also resigned in protest, including Tou Kin Chuen, Roderick Wu Kam Fun and John Lo Wai Tung.
That leaves only Andrew Lo Kai Bong, executive director and chairman of Summit Ascent and LET board member. An executive search will soon begin, with Summit Ascent stating it will “use its best endeavors” to identify suitable candidates “as soon as practicable.”
In its filing, Firich stated that it would reap $28 million from the sale of its Oriental Regent stake, thereby reducing its “exposure” in Russia.
Last August, Summit Ascent reported a loss of HKD16.1 million (US$2.1 million) in the first half of 2023, compared to a HKD85.2 million profit during the same period in 2022.
The firm also suspended work on Phase 2 of the Primorye resort due to the conflict in Ukraine. Last year, shortly after the Russian invasion began, the company indicated it might consider seeking “strategic local partners” to operate Tigre de Cristal until the situation stabilized. On February 24, the war will hit the two-year mark.
Meanwhile, according to GGRAsia, Summit Ascent has made a significant investment in Suntrust Resort Holdings, a Philippines company now building a US$1.1 billion hotel and casino in Manila’s Entertainment City.
Summit Ascent has said it’s “naturally inclined … to seek one of the best and one of the most rapidly growing emerging gaming markets in Asia—the Philippines.”
The Manila resort, Westside City, will be the fifth IR in Entertainment City, joining City of Dreams Manila, Newport World Resorts, Okada Manila and Solaire Resort & Casino. The IR will include a 450-room luxury hotel and a casino with 400 gaming tables and 1,200 slot machines. Westside City is expected to open in the fourth quarter of this year.
