Last week, Bloomberry publicly confirmed that it was mulling the sale of its Jeju Sun Hotel & Casino on South Korea’s Jeju island. On Thursday, Bloomberry announced that its Solaire Korea Co Ltd subsidiary had reached a deal to sell its 96.23% stake in Golden & Luxury Co Ltd to IKGH for KRW 117.5b (US $102.6m).
The deal still requires regulatory approval and for IKGH to perform due diligence. IKGH has made an initial deposit of KRW 10b, which will be held in escrow for 45 days, after which it will be either credited towards the sale price or returned to IKGH if the deal fails to progress.
In a filing to the Philippine Stock Exchange, Bloomberry said IKGH, “desires to enter into the Jeju market and is confident that it can attract its Chinese VIP customers to Jeju Island.”
IKGH has a stake in five Macau VIP gaming rooms as well as a deal to ferry VIPs to Crown Resorts properties in Australia. But Macau’s VIP market has been in the dumps for the past two years and IKGH chairman Lam Man Pou has expressed a desire to further diversify his company’s revenue streams.
Bloomberry acquired the Jeju Sun property in April 2015 but the venue struggled to gain traction. It was closed for nearly five months as Bloomberry undertook major renovations, then was closed again for another month as a regulatory penalty for the previous owners’ failure to pay adequate taxes.
Bloomberry’s Korean subsidiary says it now plans to focus on two land parcels it owns in the country, including a 21-hectare plot on Silmi Island and a 12-hectare property on Muul Island, both of which are within the Incheon Free Economic Zone, where most of the country’s major integrated resorts are slated to open. Bloomberry has previously pledged to spend $1b on an integrated resort on its island properties.