Hong Kong’s Summit Ascent Holdings has agreed a 9-month extension to the maturity date of a US$122.5 million loan, and subscribed to another US$127.5 million in convertible bonds, to ensure Philippines-based SunTrust Home Developers Inc can continue development work on its hotel-casino project in Manila.
According to details filed early Tuesday morning by Summit Ascent and its majority shareholder Suncity Group – which also holds a 51% stake in SunTrust – the worsening COVID-19 situation in Manila has “severely hampered the negotiations between SunTrust and various third parties in relation to securing financing for the development of the Main Hotel Casino.”
The company said it continues negotiations with several banks and financial institutions regarding financing and is in the process of responding to Know Your Customer and due diligence enquiries, but “due to the abovementioned lockdowns, discussions and various funding application processes such as due diligence enquiries have been repeatedly delayed or postponed.”
In order to facilitate progress of the Manila development and ensure all current financial obligations are met, Summit Ascent said Tuesday that it has now reached an agreement with SunTrust to extend the maturity date of a US$122.5 million loan issued in February of this year until 18 July 2022.
It has also agreed to subscribe to US$127.5 million in convertible bonds, pending approval from the Philippine Stock Exchange and shareholders of both Summit Ascent and Suncity Group.
Further outlining the reasons for assisting SunTrust, Summit Ascent – which owns and operates Russian casino-resort Tigre de Cristal in Vladivostok – said, “During the COVID-19 lockdowns in Manila, the construction schedule of the Main Hotel Casino [has been] badly affected due to the restricted supply of construction materials and labour. Still, the construction works of the Main Hotel Casino have never [been] suspended by setting up a ‘safe work bubble’ with vaccination and testing requirements for those working on the Project Site, which significantly reduces the risk of spread of COVID-19.
“However, a default of the loan by SunTrust would severely hinder the development of the Main Hotel Casino, in particular the ability of SunTrust to secure further financing due to a record of default. The default would also hinder the financial position of the Summit Ascent Group.”
Summit Ascent added that it remains confident in SunTrust securing additional required funding through financial institutions once the COVID-19 situation in Manila eases.
Due to open in 2023, the US$1 billion project is part of the larger Westside City development and will incorporate a 450-room hotel with a casino boasting 400 gaming tables and 1,200 slot machines.
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