MANILA, Philippines - The Philippine unit of Macau casino giant Melco Crown Entertainment raised P5.48 billion through an overnight top-up placement, bringing in fresh capital to fund the completion of City of Dreams Manila, its first venture outside Macau.
In a filing with securities regulators, Melco Crown (Philippines) Resorts said the deal comprised 485.18 million shares, which accounted for 9.88 percent of the company. The shares were offered at P11.30 apiece, which translated into a discount of seven percent versus the previous closing market price.
The deal was done as a top-up placement that saw controlling shareholder MCE Investments first sell existing shares to investors and then buy the same number of new shares at the same price from the company. This structure allows the deal to be completed quicker than if Melco Philippines was to issue new shares directly to the market.
The transaction still ensures that all the proceeds end up with the company.
Upon completion of the transaction, MCE’s holding in Melco Philippines will be diluted to 65.29 percent from 72.45 percent.
Shares of Melco Philippines were suspended from trading Wednesday ahead of the fund-raising announcement. Trading of its shares resumed today.
The stock closed lower than Tuesday’s closing price of P12.17 per share.
Melco Philippines plans to use proceeds from the transaction to fund work on the development of a $1.3-billion integrated casino resort in Pagcor Entertainment City.
Its board approved the other day an increase in the total budget for City of Dreams Manila to P37 billion from about P28 billion previously.
Slated for opening in October this year, City of Dreams Manila will have a casino, hotel and entertainment facilities which include the Nobu Hotel, Hyatt City of Dreams Manila and Crown Towers. The project is in partnership with retail tycoon Henry Sy’s Belle Corp.
The Sy family consolidated its gaming assets including its stake in City of Dreams Manila under once dormant firm Sinophil Corp.
City of Dreams Manila is one of the four integrated resort and casinos licensed to operate in Entertainment City, which is expected to become a prime new leisure destination in the country.