Century Entertainment International Holdings Ltd, the Hong Kong based gaming investor formerly known as Amax International, has announced a capital reorganization and increase in share capital that will see its Chairman, Ng Man Sun, become controlling shareholder.
Under the plan, Century Entertainment would see its share capital of HK$400 million worth of shares at HK$0.20 per share consolidated and reduced to become HK$4 million worth of shares at HK$0.01 per share. It would then increase the share capital of the company to HK$200 million worth of shares by the creation of 19.6 billion new shares priced at HK$0.01 per share.
In a filing, the company said it has subsequently reached an agreement with its Chairman and CEO to settle indebtedness of HK$71,271,758 by issuing HK$50 million worth of new shares to him, plus HK$21,271,758 in cash. Such an agreement would see Ng’s shareholding in the company increase from 27.74% currently to 59.40% after completion, and public shareholdings fall from 51.54% to 28.96%.
Century Entertainment, which has various agreements to operate VIP gaming tables in Cambodia, said the consolidation of current shares, issuance of new and subscription agreement with Ng would help the company reduce its current HK$81.3 million of debt.
“Taking into account, among other things, the financial position and expected operating cash flow to be generated by the Group, and given the prevailing market prices and trading volume of the Shares and the net current liabilities position of the Group, it may not be favourable to have a fund raising exercise for substantial amount by way of issue of new Shares to independent third party(ies) or to existing Shareholders on a pro rata basis (e.g. rights issue and open offer) where considerable discount to the market prices of the Shares would be required,” it said.
“After the Company’s enquiry of certain brokerage houses with no favourable responses, the Company has decided to negotiate with the Subscriber on the proposed settlement plan of the Indebted Amount. As a result of the negotiations, the Company and the Subscriber agreed to settle part of the Indebted Amount principally through the entering into the Subscription Agreement.”
Century Entertainment is currently in the process of transferring a VIP gaming room from Sihanoukville to Dara Sakor – a controversial Chinese-backed investment zone covering 360 square kilometers on the Cambodian coastline – where it plans to operate gaming tables under a deal it previously signed with Ng, who owns the casino in question.
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