In Macau and one of the companies behind the luxury The 13 hotel has reportedly applied for a ‘standstill’ order so as to prevent its bank from calling in a loan worth just over $319.9 million and potentially liquidating the company.
According to a report from Inside Asian Gaming, Hong Kong-listed South Shore Holdings Limited used an official Monday filing to proclaim that it had applied for the pause because neither its ‘borrowing entity nor the company can repay at this time’.
Previously known as Louis XIII Holdings Limited until a 2016 name-change, South Shore Holdings Limited reportedly declared that that it is now essentially seeking an assurance from the financial institution that it ‘will not take imminent steps either to enforce its security over The 13 hotel or to liquidate the company’. The firm moreover purportedly stated that it foresees ‘working closely’ with the bank so as ‘to achieve an orderly divestment of the company’s interests’ regarding the 200-room Macau facility.
Inside Asian Gaming reported that the unnamed bank had decided to call in the entirety of its loan plus interest after South Shore Holdings Limited was unable to satisfy a $60.6 loan payment that had come due at the end of last month. The company had purportedly planned to satisfy this payment via the around $96.7 million it was to receive via its disposal of a 50% stake in the beneficial owner of The 13, Uni-Dragon Limited.
However, this arrangement has yet to be completed although South Shore Holdings Limited reportedly detailed that the prospective trio of Hong Kong-based buyers had recently agreed to extend the long-stop date of their deals by another two months to June 14. The firm furthermore purportedly pronounced that the delay had been down to the ‘severe adverse effects’ of the recent coronavirus pandemic ‘on the state of the market’, especially in Macau.
Located on the border between Macau’s Coloane and Cotai Strip districts, The 13 hotel cost $1.6 billion to build and began welcoming guests in late-August of 2018 following a series of funding-related delays. Despite initially optimistic predictions, the iconic venue soon reportedly ran into difficulties and saw its loss for the six months to the end of September rise by some 15% year-on-year to almost $65.4 million.
The source further reported that a number of rooms within The 13 remain unfinished while its owners have so far made no attempt to apply for a casino license despite having ample space for approximately 66 gaming tables. This is purportedly even more confusing because the venue holds a potentially lucrative ‘service agreement’ with Macau gambling concessionaire Melco Resorts and Entertainment Limited.