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Macau owner of world’s biggest Rolls-Royce fleet to raise HK$1.7 billion to complete luxury casino

PUBLISHED : Sunday, 22 October, 2017, 1:41pm
UPDATED : Tuesday, 03 July, 2018, 9:05pm

Billionaire Stephen Hung’s gambling developer 13 Holdings has announced a plan to raise HK$1.7 billion (US$218 million) through selling stocks and debt to finance the establishment of what he calls “the world’s most luxurious casino” in Macau.

The company plans to raise HK$1 billion through a rights issue for the pre-opening expenses of Hung’s THE 13 Hotel, and raise another HK$740 million through debt financing, according to a filing to the Hong Kong Stock Exchange.

The rights issue will be underwritten by Get Nice Securities, while the sub-underwriters are CS Wealth Securities, Koala Securities, Opus HK Advisors, Opus Securities and Supreme China Securities, according to the statement.

THE 13 Hotel is a US$1.3 billion project announced five years ago, designed as the world’s most luxurious casino by Hung, a former Merrill Lynch banker and now the joint chairman of 13 Holdings. Its opening had to be postponed due to delays in obtaining licenses and cost overruns. The hotel is expected to open for business on or before March 31 next year.

The hotel plans to include a casino, subject to a formal agreement between 13 Holdings and the licensed operator, as well as approval from the Macau government.

“As such, the gaming operation may or may not commence at THE 13 Hotel, but will not affect the opening and the operation of the hotel,” company secretary Joanna Mui Ching Hung said.

The share price of 13 Holdings has plunged 60 per cent this year to HK$0.91 before trading was halted on Friday. It has applied to resume trading on Monday.

The company’s liabilities exceeded assets by HK$300 million (US$38 million) in the year ended March, with a further HK$951 million of capital commitments that were contracted or authorised but not yet provided for.

It sold a 52 per cent stake in what was its engineering subsidiary, Paul Y. The subsidiary built The 13 and accounted for much of the holding company’s revenue last year, when it made a HK$40 million net loss.

The company also spent US$20 million on the world’s biggest fleet of custom-built gold and diamond-sprinkled Rolls-Royce Phantoms.

China’s nouveau riche have previously formed the vast bulk of Macau’s gambling revenue. But as part of China’s wide-ranging crackdown on corruption, President Xi Jinping has said in recent years that Macau’s future lay in diversifying its economy away from high rollers.