Donaco International on Wednesday moved a step closer to taking over the Star Vegas Resort and Club in Poipet City after it added $100 million to a similar amount already raised since the $360million acquisition agreement was announced six weeks ago, according to a statement released by Donaco.
Donaco currently owns just one casino, the Aristo International Hotel in northern Vietnam, which first opened in 2002 but underwent a five-star overhaul completed in November, the same month that it announced its intention to expand its gaming business with the acquisition of Star Vegas.
The deal, formalized on January 30, was progressing “in an orderly manner,” according to Wednesday’s statement, following a loan secured at the end of February from Taiwan’s state-run Mega International Commercial Bank. Donaco has previously raised about $92 million in share entitlement offers.
“The company confirms that it has signed a binding commitment letter with Mega International Commercial Bank Co., Ltd for the USD100 million commercial loan facility,” the statement says, adding that Donaco’s subsidiary, Donaco Hong Kong, will receive the payment.
Donaco says it will hold “further discussions” with Mega International soon, and that after a shareholder meeting on March 27, it will be free to issue some of the company’s shares to Star Vegas’ owners —part of the funding agreement—with the deal wrapping up sometime in April.
Besides the expansion of its gaming operations at its “flagship” property in Vietnam, the company also sold off two subsidiary gaming technology companies, one in September and the second in October, in order to shift focus to establishing a casino base in Southeast Asia.
The changes partly accounted for the 75 percent drop in profit reported by Donaco in the six months ending in December, though anti-Chinese unrest last year also added to higher operating costs and lower VIP win turnovers, according to the company.