Akihabara News (Tokyo) — In the Game of Thrones-like saga that management of the Okada Manila casino resort has become, there is yet another twist; a potential partner has filed a lawsuit over alleged broken promises.
This particular dispute traces back to October 2021 when it was announced that Tokyo-based Universal Entertainment Corporation–the ultimate owner of Okada Manila–had reached a merger agreement with Miami-based 26 Capital Acquisition Corporation, a special purpose acquisition company, which would see the casino resort listed on the Nasdaq stock market in New York.
The original transaction set an enterprise value for Okada Manila at US$2.6 billion, and involved a cash injection of US$275 million.
26 Capital Acquisition Chairman and CEO Jason Ader explained at the time: “Okada Manila is the future of the gaming market in Asia and poised for tremendous growth. With its beautiful new facility, a desirable location in one of the fastest-growing gaming markets in the world, and potential for industry-leading margins and cash flow conversion, I believe the Okada Manila is an extremely compelling investment.”
The initial press release noted that “the transaction is expected to close in the first half of 2022.”
The merger plans derailed, however, when the Supreme Court of the Philippines issued its shocking order in April 2022 that the former owner, billionaire Kazuo Okada, should be restored to the role which he had played before being removed in 2017. Okada followed this up a month later by having armed agents storm the casino resort and take physical control of the facility by force.
During this turbulent period, Ader publicly and repeatedly backed the position of Universal Entertainment’s management in Tokyo, telling the media that Okada’s takeover had been “totally illegal.” He added that “we think that Universal will be back in control of the property very soon.”
Indeed, three months later, in early September, Universal Entertainment, backed by the Philippine National Police, seized back control of the casino resort. It has retained authority in a stable fashion since that time.
The latest twist is that 26 Capital Acquisition filed a lawsuit in the US state of Delaware against Universal Entertainment, its prospective partner, alleging that the Tokyo firm is now unreasonably dragging its feet on consummating the planned merger. Universal Entertainment has been back in control for about five months, and apparently their American partners figure that it is past due time to complete the agreed transaction, which is already more than seven months overdue in relation to the original announcement.
Notice of the new lawsuit so far has come only from Universal Entertainment’s side. In its statement issued this week, the Japanese firm offered only a short message regarding its outlook: “The company will scrutinize the lawsuit and properly deal with it. The company will promptly announce progress that should be disclosed.”
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