Biz Buzz: Gokongwei-Okada deal is imminent
A deal between the business group of tycoon John Gokongwei Jr. and Japanese businessman Kazuo Okada is imminent and a preliminary deal may be signed “in a few days,” a reliable source tells Biz Buzz.
Once formalized, the deal will give the controversial pachinko magnate a much-needed Filipino partner to help him fight his reputational battles locally, given the bad press being generated about him from his overseas casino rival.
The three other holders of the gaming licenses at the $4-billion Entertainment City project of the state-owned Philippine Amusement and Gaming Corp. are, of course, either locally based or have local partners who know the lay of the land, so to speak.
Incidentally, Bloomberry Resorts of ports tycoon Enrique Razon Jr. will be the first hotel-casino complex to be operating in Entertainment City, with a target opening date for the first phase of its Solaire project set for March 2013 (a little over three months from now).
This will be followed in 2014 by the operations of Macau-based Melco Crown Entertainment of billionaires James Packer and Lawrence Ho in partnership with Belle Corp.
The following year, 2015, will likely see the opening—knock on wood—of Tiger Entertainment’s gaming and hotel operations owned jointly by Okada and the Gokongweis.
The last of the four to set up shop at Entertainment City, according to our source, will be Resorts World, which is a partnership between taipan Andrew Tan and Malaysia’s Genting Group. Resorts World, we’re told, asked Pagcor for a slight adjustment in its location to a more commercially attractive part of the development.
Given the current pace of rollout of the government’s public-private partnership program, the Entertainment City may end up being the only big-ticket PPP project that will be completed before 2016.—Daxim L. Lucas
Cause of delay
One reason for the late start of the casino hotel project of Resorts World at the Entertainment City complex has its roots in a land swap deal executed between the Philippine Reclamation Authority and the government-run Nayong Pilipino Foundation during the Arroyo administration.
In that deal, the PRA would get Nayong Pilipino’s old property adjacent to the Ninoy Aquino International Airport while Nayong Pilipino would be given a property on the reclamation site along Manila Bay (which is now part of Entertainment City).
The current Pagcor management decided to undo the land swap with the concurrence of both parties, but the Manila International Airport Authority threw a spanner in the works, saying the former Nayong Pilipino site should revert to it (since it was the original owner before the late President Marcos ordered the property converted into a park).
The MIAA management wants to convert the property into a huge tarmac for general aviation and a parking area for all the presidential and VIP aircraft that will use Naia during the Asia-Pacific Economic Cooperation summit that the country will host in 2015.—Daxim L. Lucas
It’s not only former trade minister Roberto Ongpin who’s had his bank accounts frozen by the Anti-Money Laundering Council due to the controversy surrounding the alleged behest loans granted by the state-owned Development bank of the Philippines.
Biz Buzz learned that all 13 DBP officials and employees (ordered dismissed by the Ombudsman last week) were also surprised to find out that they could no longer access their accounts with DBP. Several of the employees were also distraught to find out that their accounts with other banks were frozen by the AMLC as well, including joint bank accounts they had with their spouses.
The mood at DBP was markedly downbeat last week despite the presence of holiday decorations at the bank’s lobby and Christmas songs being played over the in-house sound system. Several of the mid-level employees complained that they did not know where they would get money to spend over the next 20 days for which the AMLC freeze order is in place (assuming that it doesn’t get extended).
“They didn’t even wait for Christmas to pass,” said one affected employee. Another added: “Why were our bank accounts frozen? Are they accusing us mid-level employees of having profited from the deal?”
According to several bank insiders, the answer may lie in the tried and tested method being implemented by the critics of the DBP loan transaction: “Squeeze the low-level employees hard enough so that they will point [an accusing finger] at someone higher up.”—Daxim L. Lucas
Synergy Grid and Development Philippines Inc., the infrastructure holding firm of Henry Sy Jr., a.k.a. “Big Boy,” is not about to get itself suspended from Philippine Stock Exchange trading. While Synergy is below the 10-percent minimum public float required for continued listing at 7.44 percent, Sy said Tuesday that this could easily be remedied before the deadline, which is before the year ends.
Sy said he could not say how Synergy intended to comply but added that he was never in the habit of getting any of his companies suspended from the stock market. Based on Synergy’s current market capitalization, a prospective equity deal such as through a private placement worth around P544 million is needed to bring to public hands an additional 2.56-percent stake.
Meanwhile, Sy said that with Melco Crown on board the group’s gaming project, expect the upcoming Belle Grande complex to raise the ante in Pagcor City when the facility opens in 2014. He said there won’t be significant changes in the design but quality would nearly match that of Melco’s “City of Dreams” complex in Macau, including the granite and marble used.
“It will be of quality that has never been seen before in the Philippines,” Sy said.—Doris C. Dumlao
Get business alerts and a preview of Biz Buzz the evening before it comes out. Text ON INQ BUSINESS to 4467 (P2.50/alert).