Entertainment Gaming Asia Announces Favorably Amended Terms for its Casino Development Project in the Pailin Province of Camb...
13 Julio 2011 - 7:45AM
Business Wire
Entertainment Gaming Asia Inc. (NYSE Amex: EGT) (“Entertainment
Gaming Asia” or “the Company”), a leading provider of electronic
gaming machines on a participation basis to the Pan-Asian gaming
industry, today announced it has amended the terms of its casino
development project in the Pailin Province of Cambodia (the “Pailin
Project”), which include an increase in the Company’s share of the
project’s returns. On May 16, 2011, the Company announced its plans
to develop and operate a new casino in the Pailin Province of
Cambodia near the Thailand border. This casino, which will be named
Dreamworld Casino Pailin, is initially intended to include
approximately 23 table games and 40 electronic gaming machine
seats.
Under the amended terms, the Pailin Project will be 100% owned
by Entertainment Gaming Asia with exclusive management rights and
control over the development and operation of the casino. In
addition, the Company has entered into a 20-year lease agreement
for the land on which to construct the initial phase of the
project. It will make fixed lease payments to the land owner in the
amount of $5,000 per month with the first year of lease payments
waived. The Company also has a first right to lease the adjacent
land, which is intended to house additional project phases
including expanded casino operations and complementary facilities
such as hotel rooms, a spa and other entertainment amenities, at a
rate of $25,000 per month. This adjacent land is currently occupied
by a third party whose lease expires in the second half of 2016. In
consideration for the revised ownership structure and new lease
agreement, the Company and the land owner will now share in the
profit before depreciation and lease payments on a respective 80%/
20% basis.
Under the prior terms, the Pailin Project was to be owned by a
joint venture company, the shareholders of which were the Company
and the said land owner. The land owner was to lease to the joint
venture company the land for the initial project phase for a period
of 20 years for an annual fee of $1 and the Company and the land
owner were to share in the cash flow generated from the operations
on a respective 55%/45% basis.
The initial phase of the Pailin Project remains on target to
open in the second quarter of 2012, subject to the timely issuance
of the required gaming license and construction permits.
Clarence Chung, Chairman and Chief Executive Officer of
Entertainment Gaming Asia, commented, “We believe the Pailin
Project is a strategic project that offers significant potential
for near-term earnings and long-term growth. We are pleased to
amend the project terms to increase our share of the profit before
depreciation and lease payments, providing us the potential to earn
greater returns from this exciting project.”
Also today, the Company announced an update on its casino
development project in the Kampot Province near the border of
Vietnam (the “Kampot Project”). The Kampot Project will include a
casino, Dreamworld Casino Kampot, the initial phase of which is
intended to include up to 14 table games and 25 electronic gaming
machine seats. The Company has received the necessary gaming
license and government approvals to begin development and began
surveying the soil in preparation for the official ground breaking.
However, due to unexpected and excessive rainfall in the area as a
result of tropical storms, construction has been temporary delayed.
The Company now anticipates the initial phase of the Kampot Project
will be complete by the end of the first quarter of 2012.
Clarence Chung concluded, “We are focused on completing the
Kampot Project as quickly as possible and will employ all necessary
measures to make up the time delay where appropriate. We will
provide more updates as the development process progresses. In the
meantime, we continue to focus on securing additional casino
projects to selectively build a solid pipeline of opportunities to
achieve our goal of becoming a leading regional casino owner and
operator in the growing markets of Indo China.”
About Entertainment Gaming Asia Inc.
Entertainment Gaming Asia Inc. (NYSE Amex: EGT) is a leading
provider of electronic gaming machines on a participation basis to
the Pan-Asian gaming industry. The Company secures long-term
contracts to provide electronic gaming machines and related systems
to premier hotels and other well-located gaming venues in Asia. The
Company retains ownership of the gaming machines and systems and
receives recurring daily or monthly fees based on an agreed upon
percentage of the net gaming win per machine and provides on-site
maintenance. Entertainment Gaming Asia Inc. is also engaged in the
development of casinos in Indo China where intends to own and
operate casino resorts under the “Dreamworld” brand. For more
information please visit www.EGT-Group.com.
Forward Looking Statements
This press release contains forward-looking statements
concerning Entertainment Gaming Asia within the meaning of Section
27A of the Securities Act of 1933, as amended, and Section 21E of
the Securities Exchange Act of 1934, as amended. Those
forward-looking statements include statements regarding
expectations for the expansion of the Company’s participation
business model, the timeline and working capital requirements for
the Kampot and Pailin casino projects, the near-term earnings of
the Kampot and Pailin casino projects, growth of the gaming
industry in the Indo-China region and the Company’s ability to
secure new casino projects and fund those projects as well. Such
statements are subject to certain risks and uncertainties, and
actual circumstances, events or results may differ materially from
those projected in such forward-looking statements. Factors that
could cause or contribute to differences include, but are not
limited to, risks related to Entertainment Gaming Asia’s ability to
place gaming machines at significant levels and generate the
expected amount of net win from the gaming machines placed, obtain
the gaming license and building permits for the casino projects on
a timely basis or at all, identify, procure successfully develop
additional casino projects in the Indo-China region, acquire
additional capital as and when needed and those other risks set
forth in Entertainment Gaming Asia’s annual report on Form 10-K for
the year ended December 31, 2010 filed with the SEC on March 30,
2011 and subsequently filed quarterly reports on Form 10-Q.
Entertainment Gaming Asia cautions readers not to place undue
reliance on any forward-looking statements. Entertainment Gaming
Asia does not undertake, and specifically disclaims any obligation
to update or revise such statements to reflect new circumstances or
unanticipated events as they occur.
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