Asia Entertainment & Resources Ltd. Announces Non-Binding Memorandum of Understanding to Acquire Bao Li Gaming Promotion Limited
HONG KONG — August 06, 2012
Asia Entertainment & Resources Ltd. (“AERL” or the “Company”) (NASDAQ: AERL),
which operates through its subsidiaries and related promoter companies as a
VIP room gaming promoter, today announced that that it has entered into a
non-binding memorandum of understanding, whereby it will acquire Bao Li Gaming
Promotion Limited (“BLGP”), a Macau-based VIP room gaming promoter that
currently operates one room with five tables at City of Dreams Macau, a Melco
Crown property. Subject to due diligence and customary closing conditions,
Asia Entertainment expects to close the transaction by September 30, 2012.
The total upfront consideration for BLGP is expected to be approximately US$15
million for 100% of BLGP’s operations. Additionally, if BLGP’s Rolling Chip
Turnover is at least US$2.5 billion in each of the three years ending December
31, 2013, 2014 and 2015, its shareholders would receive three additional
purchase consideration installments of US$13 million and 625,000 ordinary
shares of AERL. BLGP’s stockholders can receive additional incentives for
exceeding these targets. Until December 31, 2015, BLGP’s promoter, Kan Kuong
Lou, would provide a personal guarantee for any bad loans associated with
BLGP’s operations prior to the closing of the acquisition.
The City of Dreams Casino offers both the fixed commission and the revenue
sharing remuneration model, and this VIP room will operate under the revenue
sharing model. From this transaction, AERL will be able to expand its existing
agents network. Upon the closing of the acquisition, AERL will have 34 tables
in four VIP rooms.
“We are pleased to have the opportunity to add BLGP to the Asia Entertainment
family,” said AERL Chairman Lam. “In addition to our current presence at the
Galaxy and Las Vegas Sands casinos, this acquisition will allow us to expand
our presence with another license holder (Melco Crown) in the Macau VIP gaming
market, and with five more tables, further mitigate volatility from the
revenue sharing model which becomes effective for all our VIP rooms on
September 1, and ultimately provide our shareholders with long-term value.”
About Asia Entertainment & Resources Ltd.
AERL, formerly known as CS China Acquisition Corp., acquired Asia Gaming &
Resort Limited (“AGRL”) on February 2, 2010. AERL is an investment holding
company which operates through its subsidiaries and related promoter companies
as a VIP room gaming promoter, and is entitled to receive all of the profits
of the VIP gaming promoters from VIP gaming rooms. AERL’s VIP room gaming
promoters currently participate in the promotion of three major luxury VIP
gaming facilities in Macau, China, the largest gaming market in the world. One
VIP gaming room is located at the top-tier 5-star hotel, the Star World Hotel
& Casino in downtown Macau, and another is located in the luxury 5-star hotel,
the Galaxy Macau™ Resort in Cotai, each of which is operated by Galaxy Casino,
S.A. The third VIP gaming room is located at the Venetian Macao-Resort-Hotel
in Cotai. visit http://www.bloomberg.com/article/2012-08-06 /aaawjPwuSvU8.html for more info.
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