Entertainment Gaming Asia has sold its struggling Dreamworld Pailin casino in Cambodia to an unidentified buyer for US$500,000.
The sale does not include the casino’s 50 or so machine games and some other equipment and assets, the company said. The buyer also is not allowed to use the “Dreamworld” name.
In connection with the sale, the company also said it has terminated all agreements with its partner in the casino, who is a relative of the purchaser and owns the land under the casino.
Dreamworld Pailin, located in the northwestern province of the same name on the border with Thailand, opened in May 2012 as Entertainment Gaming Asia’s first foray as a developer. The Nasdaq-listed company (EGT) is known mainly as a lessor and operator of machine games on a revenue-sharing basis in Cambodia (notably at Naga Corp.’s NagaWorld monopoly in Phnom Penh) and in the Philippines.
Pailin was considered a trade up from the rest of the border offering and EGT followed it in May 2013 with a larger Dreamworld-branded casino also serving the Thai market in the border town of Poipet. Pailin never quite found its legs, however, and EGT said that while operating losses have narrowed in recent months the property has suffered from what it calls a “low level of natural player traffic,” and in December, EGT wrote off the entirety of its US$2.5 million investment. The company said also that it has been unable to secure a long-term third-party operator for the casino’s 26 table games, and revenue has been additionally crimped by the political unrest in Thailand, where news reports have it that fewer Thais are crossing into Cambodia to gamble since the May military coup.
EGT also manufactures and sells RFID and traditional gaming chips and plaques to casinos in the region under its Dolphin brand.
The company is indirectly linked to Lawrence Ho’s Melco Group through a wholly owned Melco entity called EGT Entertainment Holding, which owns 38% of EGT’s stock.
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