Tiger Resort Asia Ltd (TRA) the parent company of Okada Manila operator Tiger Resort, Leisure & Entertainment Inc (TRLEI), has entered into a merger agreement with a special purpose acquisition company (SPAC) that will see it listed on the United States NASDAQ.
Details of the merger were made public on Friday, with TRA outlining a “reverse triangular merger” by which TRLEI and a SPAC entity called 26 Capital Acquisition Corp will both become wholly-owned subsidiaries of Okada Manila International Inc (OMI). OMI will be recognized as a NASDAQ-listed company, with TRA expecting to retain around 80% of the share capital.
The merger agreement valuates the total equity value of OMI at US$2.5 billion, with TRLEI stating it considers this to be reasonable given consideration of all factors, particularly revenue. OMI’s management structure has yet to be confirmed but TRLEI said it expects the Board of Directors to comprise seven members, five of which will be appointed by the group and two by the current management of 26 Capital.
The listing is seen as a way of enhancing the value of the company and diversifying its access to financing.
“Since March 2020, the company has operated its business under extremely limited conditions such as repeated lockdowns in Manila due to the spread of COVID-19,” TRLEI said.
“Under such a harsh environment, however, the company has deployed a number of measures for the purpose of bolstering its earnings, including reducing fixed expenses and reinforcing marketing … and [proceeding] with the construction of Coral Wing (Tower B) hotel, which is expected to be completed by the end of this fiscal year. The company will continue such measures and expansion of [the] facility even after the operations return to normal … aiming to increase business value.
“Considering this situation, the company has positioned the IR business as the core business of the company group and has decided [to list] OMI on the NASDAQ with the aim of further business expansion, increasing the company group value and diversifying financing methods and sources.”
Implementation of the merger and listing on the NASDAQ is expected to be completed by the end of June 2022.