Inside Asian Gaming

IAG MAY 2019年5月 亞博匯 56 IN FOCUS “We structured that deal with one-third of the price in shares to align his interests with other shareholders,” Donaco Executive Director Ben Reichel says. Reichel rejects as “lazy” criticism that Donaco never should have bought Star Vegas due to Cambodia’s legal and regulatory status. Former Australian gaming regulator Peter Cohen of The Agenda Group says, “I don’t believe that the lack of regulatory control is in itself problematic, but any Australian-listed company has obligations to comply with AML and anti-corruption rules wherever they operate.” Donaco hasn’t faltered on those fronts. HIGH MARGIN Donaco gave Somboon a two year contract to manage Star Vegas through 30 June 2017. He guaranteed US$60 million annual property EBITDA, met the targets – posting margins of better than 60% - and earned management fees equivalent to roughly one-third of EBITDA. Experts call the fee rich but not outrageous. Those two years weren’t all smooth sailing, though. Donaco’s stock price fell following the acquisition and US$55 million Aristo’s rollout into China-Vietnam tensions and President Xi Jinping’s corruption crackdown. Thailand’s king passed away in October 2016 and mourning decreased Poipet revenue. Somboon’s Star Paradise hotel, across the street from Star Vegas, added gaming areas in 2016. Donaco says it wanted Star Paradise gaming to accommodate new junkets, although Star Vegas had ample space for gaming expansion. Others say Somboon wanted his own casino again. What’s clear is that Somboon has a non-compete clause barring him from opening casinos in Poipet, and that Donaco managed the Star Paradise facility for a US$150,000 monthly fee. In a March 2017 interview with Inside Asian Gaming , Joey Lim said Donaco hoped to extend Somboon’s Star Vegas management contract and, in case Thailand legalized casino gambling – Poipet’s nightmare – Donaco would rely on Somboon’s Thai connections to seek a license.