Donaco International Ltd has announced the successful completion of an entitlement offer that will see the company raise AU$14.41 million before costs.
The offer, first revealed on 3 July, was underwritten by the Thai vendors of Donaco’s Star Vegas casino in Poipet, Lee Bug Huy and Lee Bug Tong, who hold a 17.99% stake in the company. The duo had previously been involved in a series of legal battles with Donaco before recently reaching a settlement following a series of changes to the company’s board composition.
In announcing completion of the entitlement offer via an ASX filing, Donaco noted the severe impact COVID-19 has had on its two casino operations – Star Vegas in Cambodia and Aristo International in Vietnam – and said it has been working closely with its lenders, including primary financier Mega International Commercial Bank Co Ltd to mitigate the financial impact. Mega Bank recently agreed to defer a debt facility repayment from June to December 2020.
“The proceeds of the entitlement offer will be used to meet the upcoming repayment requirements under the debt facility with Mega Bank, in addition to working capital purposes in relation to the two casinos,” Donaco said.
“The funds raised will enable Donaco to continue to service its debt obligations as well as provide financial stability to the company.”
Donaco previously announced that Chairman Mel Ashton and non-executive director Simon Vertullo would step down from the board following completion of the offer, although no reference was made to their departure in Monday’s filing.
Star Vegas, located in Poipet near the Thai border, has been closed since late March due to COVID-19, while the company’s Vietnam casino, Aristo International, reopened in May with limited operations.