Melco International Development Ltd, the parent company of Macau concessionaire Melco Resorts & Entertainment, has commenced arbitration in mainland China for compensation from a former joint venture partner alongside whom it was to develop a multi-billion dollar mixed-use residential, entertainment hospitality complex in Zhongshan, Guangdong Province.
In a filing in which it pointed to the “performance of relevant payment obligations” of its former partner, Melco International said it had commenced arbitration at the China International Economic and Trade Arbitration Commission for failing to meet certain provisions in a Joint Venture Cooperation Agreement signed in 2021.
The company’s request for arbitration has been accepted by the China International Economic and Trade Arbitration Commission, pending hearing, but has not yet been heard, Melco added.
The original project had been planned to cover a gross floor area of 750,000 square meters in the heart of Zhongshan, located just north of Zhuhai, and feature residential, commercial, recreational and entertainment elements, including residential complexes, office areas, hotels, serviced apartments, wellness centers, shopping malls and a theme park.
Melco International’s role would have been to develop and manage the theme park, restaurants and other hospitality facilities in the complex at a cost of RMB400 million (US$55 million).
However, the company announced in September 2023 that it had served its joint venture partners with notice to terminate a cooperation agreement and supplemental agreements due to their failure to meet requirements.
An impairment of HK$104.2 million (US$13.4 million) on investment costs related to the project has since been made.
RelatedPosts
