PH Resorts Group, the gaming and hospitality arm of Philippines business conglomerate Udenna Group, says it has resumed discussions with numerous parties over a potential investment that would allow it to resume development of its integrated resort project in Cebu.
The company also says it has held dialogue with lenders over amendments to its current loans and liabilities while insisting it has the backing of its parent in ensuring its long-term viability.
The update, part of PH Resorts Group’s 2022 Annual Report published Wednesday, comes after a proposed investment by Bloomberry Resorts, owner and operator of Manila’s Solaire Resort: Entertainment City, was terminated in March. That investment would have seen Bloomberry acquire a substantial share in PH Resorts Group’s Cebu IR development, The Emerald Bay, and another stalled project known as The Base Resort Hotel and Casino in Clark.
In its Annual Report, PH Resorts Group said it has now “re-entered into discussions with other parties that were previously put on hold due to the contemplated investment by Bloomberry.”
While the company did not divulge any further information on who these parties might be, it described the negotiations as “strategic investor discussions” and said, “Due diligence is ongoing and in various stages of completion.”
Phase 1 of The Emerald Bay, said to include 122 gaming tables, 600 electronic gaming machines (EGM) and 270 hotel rooms, had been due to open last year before construction ground to a halt during COVID.
Having fallen to a total comprehensive loss of Php801.9 million (US$14.5 million) in 2022 – on top of a Php 153.0 million (US$2.8 million) loss in 2021 – the company’s auditor made note in its Annual Report that “a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern.”
However, PH Resorts Group said it has held ongoing discussions with Land Bank of the Philippines (Landbank) to further extend its principal and interest payments; ongoing negotiations on a transaction that would address outstanding obligations with China Banking Corporation (CBC); and has negotiated to extend the maturity of an advance from a related party from 30 April 2023 to 30 June 2024.
It also said it has received a letter of financial support from its ultimate parent company stating that the parent shall “extend its full and continuing support for PH Resorts” in regard to a Php1 billion (US$18.1 million) deposit previously paid by Bloomberry until such time as the company is in a position to make the repayment without impairing its liquidity position.
“Management believes that, considering the progress of the steps undertaken to date, these financing and capital raising plans are feasible and will generate sufficient cash flows to enable the Group to meet its obligations when they fall due and address the Group’s liquidity requirements to support its operations and the completion of its projects,” the company said.
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