Bloomberry Resorts Corp. will not be conveying their Jeju Sun Hotel and Casino property to the Iao Kun Group after the latter failed to secure financing for the deal. While confirming that the property had been offered for sale, Bloomberry chairman Enrique Razon Jr. told reporters on the sidelines of an event in the Philippines Thursday that the deal had fallen through. Bloomberry chair Enrique Razon Jr. and Iao Kun entered into an agreement with Bloomberry’s Golden & Luxury Co. Ltd. in June to purchase a 96.23 percent stake in the operating unit for ₩117.5 billion (about US$100 million).
Although the property had struggled to ramp up since Bloomberry’s acquisition, hurting the company’s bottom line as they explored casino development on several continents, revenues are beginning to pick up on Jeju Island and the company is in no hurry to replace Io Kun and offload the property. Razon put the property up for sale less than a year after purchasing it as it wasn’t performing well. Previous management had tax problems and the casino was forced to close for a month as a sanction. Bloomberry took that opportunity to accelerate refurbishment work on the former “T.H.E. Hotel & Vegas Casino”.
Business is back up in the Philippines as well, creating a return to profitability for Bloomberry and removing pressure to jettison less well-performing assets that could become high producers. The Solaire developer’s acquisition of the Jeju property was their first venture outside of the Philippines. Bloomberry was one of three finalists for the coveted southern Cyprus integrated resort license awarded to Melco/Hard Rock after Bloomberry and NagaCorp failed to submit bids in time for the tender. Property acquisition was reportedly the factor that stalled the failed applications past a government mandated deadline, which was extended once. Bloomberry also has their eye on Argentina for development according to a Philippines stock exchange filing in late 2015. At home, Razon is reportedly looking to Quezon City in north Manila to develop a $481 million casino property.
Bloomberg returned to profitability with an August report covering the first half of 2016.
Iao Kun Group Holding Company Ltd had been a major player in the Macau junket and promotions scheme and was one of the first operators to begin posting heavy losses as Beijing cracked down on Macau high roller gambling. They were also acute enough diversify earlier when they acquired internal junket assets for Crown casinos in Australia in May 2015. However, they continued to close VIP rooms in Macau as rolling chip volumes plummeted.
In September Iao Kun said they were still working on finalizing the deal to purchase Jeju Sun even though the June announcement indicated the deal could close within 45 days. Bloomberry denied the report at that time. In October it was reported Iao Kun was pulling out of the South Korean deal and would work on paying down lines of credit by focusing on collecting outstanding debts.