Asian casino operator Donaco International insists it’s on target to meet the October launch date of its Cambodian online gambling operations.
Last week, Donaco CEO Joey Lim suggested that his company’s Star Vegas casino in Poipet, Cambodia might not make its stated October launch of online gambling operations. Lim told a Malaysian business paper that it could take “maybe six to seven months to develop the platform” and integrate it with the property’s CRM tools.
Fast forward to Tuesday, when Donaco filed papers with the Australian Stock Exchange indicating that its junket marketing partner Vivo Tower Limited had prepared an area in Star Vegas “for 12 online gaming tables, to be operated by third party junkets.” This online gaming area is “expected to commence operations within the next month.”
Cambodia permits many of its casino operators to conduct online gambling activities, provided they don’t accept local residents as customers. Last October, Donaco announced that it was in possession of an online gambling license and was exploring ways to utilize this heretofore untapped revenue channel.
Donaco says the online platform was developed by a third-party, believed to be one of its new junket partners, with which the company has struck a revenue sharing deal.
DONACO ORDERS FORMER THAI PARTNER TO CEASE & DESIST
In less positive news, Donaco announced that it has issued a cease-and-desist notice to the unidentified Thai vendor of the gaming room at Star Paradise Hotel, which adjoins Star Vegas. In August 2016, Donaco began managing a gaming room at Star Paradise, for which Donaco received a fee of THB 5m per month.
This management contract has since expired and no new deal has been signed, but the Thai vendor continues to operate the Star Paradise gaming room. Donaco views this as a breach of the non-compete provisions that the family of the Thai vendor agreed to when Donaco purchased Star Vegas two years ago.
Donaco says it’s waiting to see how the Thai vendor responds to its C&D letter, but says Donaco “will not hesitate to commence legal proceedings to enforce its rights under the non-compete provisions, should this become necessary.”
SELL, SELL, SELL!
Finally, Donaco said that the family of its CEO had sold 37.5m shares in the company for “private and family reasons,” netting a total return of A$15m (US $11.8m). The announcement said no further share sales were planned “at this time.”
Joey Lim said he maintains that Donaco’s shares are undervalued, but “due to the timing of these circumstances, there was no alternative but to sell shares at this time.” Lim also said he and his family continue to hold over 230m Donaco shares, representing over 27% of the stock.