Chow Tai Fook in talks to acquire Bahama resort project BahaMar

Date: 01 Nov 2016

Source: GGR Asia

Hong Kong-based Chow Tai Fook Enterprises Ltd, an investor in casino resorts in Macau, Australia and Vietnam, says it is in talks to acquire Baha Mar (pictured in a rendering), a stalled casino resort project in the Caribbean archipelago of the Bahamas.

The company “has applied to the government of the Bahamas for approval as a proposed investor and acquirer of the Baha Mar Resort,” the firm said in a press release last week.

Chow Tai Fook Enterprises intends to acquire Perfect Luck Assets Ltd, “the company to which certain assets of the Baha Mar Resort have been transferred,” it added. Perfect Luck is the special purpose vehicle established by China Export-Import Bank, Baha Mar’s secured creditor.

“Chow Tai Fook Enterprises is looking forward to having Baha Mar join its portfolio of world-class integrated resort development projects,” said the company’s chairman, Henry Cheng Kar Shun, in a statement. “We are fully committed to this project and plan to hire as many Bahamians as possible to work at the property,” he added.

Henry Cheng is the son of Hong Kong billionaire Cheng Yu Tung, who died in late September. Privately-held Chow Tai Fook Enterprises’ businesses span hospitality, property development and retail, including retail chain Chow Tai Fook Jewellery, part of Hong Kong-listed Chow Tai Fook Jewellery Group Ltd.

Henry Cheng has been a non-executive director of Macau casino operator SJM Holdings Ltd since 2013, following his father’s retirement from the SJM Holdings board. Chow Tai Fook Enterprises acquired a controlling stake in a US$4-billion Vietnam casino project in September 2015. The scheme involves Macau junket investor Suncity Group and VinaCapital group, a major investment management and real estate development firm in Vietnam.

Chow Tai Fook Enterprises is also involved in the development of a casino resort in Brisbane, the capital of the Australian state of Queensland.

Investment, jobs

The Hong Kong company did not provide any financial details regarding its efforts to acquire Baha Mar, but said it would invest heavily ahead of the official deal completion through pre-opening activities and employment.

“Chow Tai Fook Enterprises is dedicated to the successful opening of Baha Mar and will work with the government to achieve the goal of a phased opening,” the firm said.

The original developer of Baha Mar – Baha Mar Ltd, led by businessman Sarkis Izmirlian – filed for Chapter 11 bankruptcy protection in a Delaware court in the U.S. on June 29, 2015 claiming it faced debts of US$2.7 billion. But the Commonwealth of the Bahamas Supreme Court rejected an application seeking approval for the recognition on the bankruptcy orders issued by a judge in the United States.

A company called BMD Holdings Ltd, led by Mr Izmirlian, issued a statement on Friday, offering comment regarding Chow Tai Fook Enterprises’ announcement.

BMD Holdings stated: “The fact is that a close reading of the Chow Tai Fook Enterprises press release makes clear that there is no deal between Chow Tai Fook Enterprises and CEXIM [China Export-Import Bank]/Perfect Luck. If indeed Chow Tai Fook Enterprises and CEXIM/Perfect Luck are in negotiations, then it can only serve the interests of the seller and the Bahamas to have a competitive process to achieve the best outcome. BMD stands fully prepared to engage with the seller to achieve such.”

Construction works to complete the Baha Mar casino resort have recently resumed, according to local media reports.

In its latest press release, Chow Tai Fook Enterprises said it is already in discussions with hotel brands previously involved in the Baha Mar project. The company also intends to bring its own subsidiary, Rosewood Hotel Group, as a luxury hotel operator at Baha Mar, it added.

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