Donaco International Limited says its Star Vegas casino in Cambodia “continues to rebuild” in the wake of a bitter dispute with its Thai vendor for breach of contract and illegal Poipet competition.
Explaining the reasons behind a 25% year-on-year decline in rolling chip turnover to THB24.78 billion for the three months to 31 March 2018, the Australian-listed company pointed the finger squarely at the vendors – previously named as Somboon Sukcharoenkraisri and his two sons Lee Bug Huy and Lee Bug Tong – for continuing to run gaming operations in defiance of non-compete provisions at Star Paradise, which is located adjacent to Star Vegas in Poipet.
Donaco, which is is seeking damages of US$120 million, won an injunction via a Cambodian court in December to close Star Paradise casino and is continuing to pursue enforcement of its legal rights via arbitration proceedings in Singapore. It was also granted an ex parte interlocutory order by way of a Mareva injunction in an Australian court two weeks ago to freeze the Donaco shares held by the Thai vendors. The vendors own 148 million shares in Donaco, representing approximately 17.9% of the company’s issued capital.
Despite the decline in rolling chip turnover, Donaco said the figure was a substantial improvement on the 64% decline it suffered in the six months to 31 December 2017. It added that the addition of a new junket on 9 February saw total VIP turnover in February increase 13% year-on-year to THB8.56 billion.
Average daily visitation in 1Q18 increased 30% to 4,462 casino visitors per day, compared to 3,426 visitors per day last year, while February saw average daily visitation increase 38% to 4,630 casino visitors per day.
Both visitation and rolling chip increased slightly at Donaco’s Aristo International Hotel in Vietnam, with VIP turnover up 1% to RMB2.5 billion.
Donaco Executive Director Ben Reichel said, “We are confident in the prospects for Star Vegas under Donaco’s management, as we continue to rebuild from the damage caused by the Thai vendor’s breaches.”
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