Hong Kong’s Summit Ascent Holdings has entered into an agreement to loan HK$930 million (US$120 million) to Philippines-listed SunTrust Home Developers to fund the construction of SunTrust’s hotel and casino development in Manila’s Entertainment City.
The loan, to be issued by Summit Ascent subsidiary SA Investments, will be issued due to delays in Summit Ascent’s own development works in Vladivostok, Russia, where it is has started construction of Tigre de Cristal Phase 2.
Both companies are majority-owned by Hong Kong’s Suncity Group, which owns a 67.5% stake in Summit Ascent and 51% of SunTrust. Summit Ascent also holds Php5.6 billion worth of convertible bonds in SunTrust, which would equal a 30.03% stake should it choose to convert.
In a filing, Summit Ascent said COVID-19 continues to impact the progress of the pre-construction phase of Tigre de Cristal Phase 2, with around HK$465 million (US$60 million) in proceeds from a recent rights issue that saw Suncity boost its stake no longer required for immediate use.
“Having considered the commercial benefits to the Group in deploying the original portion for Tigre de Cristal as a loan and generating interest income to the Group for the moment, the Board is of the view that the proposed change … is fair and reasonable and in the interests of the Company and the Shareholders as a whole.”
Under the terms of the loan SunTrust will pay interest of 6% per annum.
The Manila hotel and casino development, scheduled for completion in late 2022, is set to cost US$700 million and cover an area of around 44,000 square meters, with a building floor area of 182,000 square meters.
The project will include 400 gaming tables and 1,200 slot machines across both VIP and mass gaming, plus 400 five-star hotel rooms and 960 parking spaces. The Westside City Resorts World township will also offer additional facilities such as a Grand Theatre, shopping malls and 2,000 parking spaces.