Australia’s Frontier Capital said it will proceed with plans to buy the Stotsenberg Leisure & Hotel Corp. in the Philippines for $26 million, subject to shareholder approval.
Situated in the Clark Freeport Zone, the hotel has 239 rooms, a convention center that can accommodate up to 2000 people, a swimming pool and bars and restaurants.
The Casablanca casino in the hotel has 36 gaming tables, 190 slot machines and two VIP rooms.
E!xcite Gaming and Entertainment will provide management and operate the casino. The company has provided a five-year profit guarantee of $5 million per annum to Frontier.
Upon receipt of accounts verifying net profit after tax figures for 2016 through to 2020, E!xcite will be issued 28.44 million shares representing the $5 million guaranteed profit. If NPAT is less than that amount E!xcite will pay the difference between the $5 million and the actual NPAT before the shares are issued.
Frontier says it has decided to proceed with the acquisition to capitalize on expected growth in the Philippines. It cites Citi and Macquarie Research as saying the market is the fastest growing in Asia.
“Our entry into the gaming industry is well timed to capitalize on this potential,” chief operating officer Ken Wong said.
The hotel is situated less than 2km from the Clark International Airport. The zone is a former U.S. military base and benefits from fiscal and non-fiscal incentives. The base is about 80 km northwest of the capital Manila.
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