Oriental Regent Ltd, a subsidiary of Hong Kong-listed Summit Ascent Holdings Ltd, is set to sell its gaming and hotel operations in Russia. The wholly-owned subsidiary, G1 Entertainment LLC, is being sold to Russian entity Dalnevostochniy Aktiv LLC for a price consideration of $116 million.

According to reports from GGRAsia, the acquisition of 100% of shares of G1 Entertainment would grant Dalnevostochniy Aktiv LLC control over the Tigre de Cristal casino resort near Vladivostok.

Simultaneously, the sale of Oriental’s property in Russia is expected to significantly influence the balance sheet of its parent company, Summit Ascent Holdings. The sales price of $116 million is slated to be paid in Chinese yuan.

Oriental Regent, 77.5% owned by Summit Ascent Holdings, utilized its majority share to oversee the Tigre de Cristal casino facility through the operator G1 Entertainment. G1 Entertainment holds a gaming license granted by the Russian government, facilitating its role as a licensed operator.

The G1 sales deal is poised to smoothen the transition for Dalnevostochniy Aktiv LLC to seamlessly continue the resort’s operations. Meanwhile, Summit Ascent can utilize the expected $116 million proceeds to boost its balance sheet figures, which experienced a decline in 2023.

Summit Ascent Holdings acknowledged the impact of a loss of US$14,606,000 in 2023 due to foreign-operation exchange differences reclassification, resulting in a negative impact of US$3,784,000 on shareholder equity.

The $116 million price consideration is of particular interest to stakeholders like Taiwan-based Firich Enterprises Co Ltd, holding a 20% share in Oriental Regent. If the deal closes, Firich anticipates collecting $28 million in cash, effectively reducing its exposure in Russia to zero.

With a 77.5% share in Oriental Regent Ltd, Summit Ascent Holdings may significantly capitalize on the $116 million sale. Firich Enterprises expects $28 million from its 20% share, allowing Summit Ascent to garner around $85 million and potentially compensate for the negative impact of the loss sustained in 2023.

As of the news announcement on January 11, 2024, Summit Ascent’s shares were reportedly suspended from trading in Hong Kong. LET Group Ltd, the parent of Summit Ascent, simultaneously halted its shares, stating it was pending the release of an inside information announcement.

Original article: https://www.yogonet.com/international/noticias/2024/01/12/70380-summit-ascent-39s-oriental-regent-initiates-116-million-sale-of-russian-gaming-ventures

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