Macau Legend Development Ltd. Initiates Deal to Sell Savan Legend Casino in Laos

Macau Legend Development Ltd., the investment holding firm best known for owning the Macau Fisherman’s Wharf zone and managing the Legend Palace satellite casino, recently declared its desire to sell the Savan Legend Casino in Laos. The move is consistent with the company’s strategic goal of redirecting resources to its Macau operations. Macau Legend has reached a deal with Japanese tycoon Shundo Yoshinari, opening the stage for the possible sale of Savan Legend.

On June 13, Macau Legend announced that it has signed a Letter of Intent with Shundo Yoshinari outlining the terms and conditions of the sale of Savan Legend. Yoshinari will buy the whole ownership position in Macau Legend’s subsidiary, MLD Resorts Laos Limited, subject to due diligence and completing particular standards, according to the agreement. Following the completion of the due diligence assessment, a formal agreement is likely to be finalized within 14 days.

A formal deal might be finalized by mid-August, according to the anticipated timeframe offered by Macau Legend. Shundo Yoshinari’s side is needed to put an initial deposit of $10 million as part of the agreement, which will be settled in stages as the sale advances. A $12.5 million payment is required upon signing the formal agreement. The remaining $22.5 million will be paid upon agreement completion, which is generally expected in the second half of September.

Several factors influenced Macau Legend’s decision to sell Savan Legend Casino, according to the company. Although the company was successful in fiscal year 2022, the corporation notes that the company’s financial performance is volatile and that Laos’ increasingly rigorous laws hinder future profitability. Macau Legend can reallocate financial resources to improve its operations in Macau and pursue overall future development by divesting itself of Savan Legend. The firm thinks that signing the Letter of Intent and moving further with the prospective sale will benefit both the company and its shareholders.

The purchase of Savan Legend Casino by Macau Legend is subject to certain conditions. These include the requirement that Savan Legend engage into a flat tax arrangement with the Laotian government, ensuring mutually agreeable terms. Furthermore, the original gaming license will be for 99 years, with no unfavorable terms for Mr Yoshinari within the land tenancy certificate. After these conditions are met and the purchase is completed, Macau Legend hopes to collect the remaining $45 million within three months after signing a non-disclosure agreement.

The company recently recorded a HK$607.2 million loss for the fiscal year ending December 31, 2022. The impact of the COVID-19 epidemic and the associated border restrictions is being blamed for the poor financial performance. Despite these difficulties, Macau Legend continues to operate the casino at Legend Palace in Macau as part of a new three-year arrangement with SJM.

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