MGM Resorts International terminated its agreement to manage a
hotel-casino development in Vietnam that is partially owned by Pinnacle
Entertainment.
In a filing Thursday with the
U.S. Securities and Exchange Commission, Pinnacle disclosed that MGM Resorts
exercised its right to end the agreement because the project did not achieve
certain pre-opening milestones before March 1.
In an emailed statement, MGM
Resorts spokesman Gordon Absher said the company would work with the project's
developers to "ensure a smooth transition" of the resort's
management.
Asian Coast Development Ltd.,
which is 26 percent owned by Pinnacle, is the developer of the Ho Tram Strip
integrated resort complex in Vietnam. The company is currently constructing the
first of five planned phases in the development.
The MGM Ho Tram Strip was to be
managed by MGM Hospitality, a subsidiary of MGM Resorts, and would include 541
hotel rooms, restaurants and amenities, and a casino with 500 slot machines and
90 table games.
In August 2011, Las Vegas-based
Pinnacle spent $95 million to acquire its stake in the Asian Coast Development.
Harbinger Capital Partners is the majority owner of ACDL.
Last year, Pinnacle wrote off $25
million toward the investment because of the project's delays. According to the
company's website, Pinnacle said its ownership stake in Asian Coast Development
was 23 percent.
Macquarie Securities gaming
analyst Chad Beynon told investors he wouldn't be surprised to see Pinnacle
take further write-downs toward its investment in the project.
"The fact that MGM
Hospitality will no longer be associated with this project will greatly detract
from the success of the resort/casino," Beynon said in a research report.
"MGM not only provided a
global brand name, but it was also was a significant part of the design and
vision of the first phase. It remains unclear who will actually manage the
first phase of the project now."
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated in Singapore since 1994. As Your Business Companion, we propose a range of services in Strategy, Investment and Management, focusing Health care and Life Science with expertise in ASEAN 's area. We are currently changing the platform of www.yourvietnamexpert.com, if any request, please, contact directly Dr Christian SIODMAK, business strategist, owner and CEO of SBC at christian.siodmak@gmail.com. Many thanks.
No comments:
Post a Comment