HK investors buy 33% stake in San Lazaro developer

The Manila Jockey Club group has taken in a consortium of Hong Kong-based investors as a strategic partner in its hotel and tourism estate unit MJC Investments Corp. (MIC) to beef up new capital needed to develop an entertainment hub at its former San Lazaro racetrack in Santa Cruz, Manila.

The new investor group will get 33 percent of MIC for a consideration of P450 million, the company said in a statement. A disclosure to the Philippine Stock Exchange said the new group would acquire 450 million new shares of MIC, implying a P1 price each, and that their shares would be locked up for a two-year period.

Manila Jockey Club Inc., the parent company, remains as the controlling shareholder.

The MJC group described the Hong Kong investor consortium as having a diverse portfolio of global investments and led by Cheah Teik Sing, managing director of ECM Libra Financial Group Berhad, a listed boutique financial services group based in Kuala Lumpur, Malaysia.

Sing previously served as managing director of BNP Paribas Hong Kong and has more than 20 years of international investment banking experience. He also serves as an independent non-executive director of Malayan Banking Berhad.

The transaction is seen providing MIC with fresh funds to construct its first project, a five-star hotel, tourism and entertainment hub on a 7,500-square-meter site at the San Lazaro Tourism and Business Park, which is home to a high-end residential condominium project jointly developed by Ayala Land Inc. and MJC as well as the SM San Lazaro mall.

“We are gratified with the vote of confidence in MIC’s business and future potential demonstrated by this substantial investment by an international investment group,” said Alfonso Reyno Jr., chair and chief executive officer of MJC Investments Corp.

“The Hong Kong consortium brings a unique level of world-class, global experience and expertise to MIC’s business and further empowers our ambition to emerge as a significant player in the Philippines’ rapidly growing tourism industry. We look forward to making more concrete progress and delivering on our commitments for the benefit of all our shareholders and stakeholders,” he added.

The hotel project will offer 160 suites, a column-less ballroom that can accommodate more than a thousand persons, 5,000 square meters of themed event space and a thousand parking slots. The company is grooming the area to attract East Asian tourists and local visitors who have long clamored for world-class accommodations, entertainment and recreational facilities in the high-density greater Chinatown area.

Piling works were ongoing at the site and full operation of the facility was expected within 24 months, the company said.

The Manila Jockey group sees various investments in tourism projects eventually changing its business mix in favor of property development, but horse racing and gaming are seen remaining a substantial component of its business.

MJC conducts its racing operations at its horse-racing facility in Carmona, Cavite. It also operates off-track betting stations (OTBs) and is expanding its OTB network in Metro Manila as well as in the provinces. It has ventured into gaming operations with the establishment of a casino known as the Pagcor Club San Lazaro located at the 3rd Floor of the Turf Club at the San Lazaro Leisure Park in Carmona, Cavite.