Rich Goldman Holdings, a company involved in junket operations as part of its leisure and entertainment business, announced in a filing to the Hong Kong Exchanges and Clearing (HKEX) that the profit share agreement with a venture partner related to junket business at Solaire Resort & Casino in Manila had been terminated.
Agreement Terminated
Rich Goldman, holder of a 51% stake of Ever Lucky Global Ltd joint venture via its subsidiary Prime Jade Enterprises Ltd and its joint venture partner Tam Ka Wo, holding 49% via Great Happy Century Ltd, reached a mutual agreement to terminate the profit share agreement related to profits generated from junket operations at Solaire casino resort in the Philippines effective January 1, 2022.
The profit share agreement that was first announced in filing to the HKEX exactly a year ago was rendered void due to the adverse effects of the “prolonged social distancing and travel restrictions measures imposed by the local government in the Philippines” in response to the continuous spread of the coronavirus.
The intense market competition in the country further impacted the performance of the joint venture company, bringing down the financial results achieved by the joint business to unsatisfactory levels, Rich Goldman stated in the filing dated December 30, 2021.
Rich Goldman outlined the high level of uncertainty brought to the leisure and entertainment industry by the ongoing restrictive approach to tackling the pandemic, as well as the regulatory uncertainty in the gaming industry were the main factors that forced the group to shift its focus away from gambling and towards its other businesses, money lending and hotel operations.
Suncity Domino Effect Continues
The termination of the agreement is the latest development related to the junket industry in the region, following the massive blow it sustained last year after the arrest of Suncity CEO Alvin Chau Cheok Wa in November and the following closure of Suncity-operated VIP rooms in Macau in December.
Founder of the largest junket operator in the region Alvin Chau was detained in the special administrative region (SAR) on allegations of facilitating Chinese residents to gamble offshore and cross-border, in violation of Chinese law which prohibits gambling on the mainland.
Following the arrest, all six casino license holders in Macau held meetings to discuss the future of junket operations, considering cutting ties with junket companies completely by the end of 2021. Two of them, Wynn Macau and Melco Resorts, have already confirmed their casinos operate free of VIP gaming promoters.