The Russian company that entered into a deal to fully acquire the operating entity of Summit Ascent’s Tigre de Cristal integrated resort near Vladivostok, Russia, has terminated the deal.
Summit Ascent and its parent company LET Group Holdings revealed by way of separate filings that Dalnevostochnyj Aktiv LLC had on 19 February served Tigre de Cristal operator Oriental Regent Ltd with a “notice of unilateral extrajudicial repudiation (withdrawal from execution) of the Agreement”, seeking to affect a termination of its deal to acquire G1 Entertainment LLC for US$116 million.
Summit Ascent holds a controlling 77.5% stake in Oriental Regent, while LET Group, formerly known as Suncity Group, owns 69.66% of Summit Ascent.
LET and Summit Ascent said they will be seeking legal advice on the Termination Notice, with trading in shares of both still suspended.
The proposed sale of Summit Ascent’s stake in Tigre de Cristal has been controversial, with directors of both Summit Ascent and LET Group stepping down en masse last month in protest – leaving Chairman Andrew Lo Kai Bong as the only remaining member on either board.
The transaction also caught the eye of Hong Kong’s Securities and Futures Commission (SFC), which released a statement citing “serious concerns about the conduct” of management of both companies. In particular it suggested the sale had been agreed without the necessary approval of shareholders, and that the companies had failed to respond to requests from the SFC to address its concerns.
Prior to details of the planned sale becoming public, Summit Ascent had halted development of Tigre de Cristal Phase 2 in March 2022 due to the conflict in Ukraine, which saw significant economic restrictions placed on Russia by the global community. The company cited a changed business environment and the need to generate value for shareholders for that decision.
It also flagged in March 2023 that it may consider seeking “strategic local partners” to operate Tigre de Cristal as a result of challenges brought about by the war.
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