Davao Tycoon Dennis UY’s PH Resorts Restructures Debt, Secures Potential Investor for Emerald Bay Project

PH Resorts Group Holdings Inc., the tourism and gaming company founded by Davao-based entrepreneur Dennis Uy, has finalized a debt restructuring agreement with China Banking Corp. for its $600 million Emerald Bay casino resort in Cebu. This arrangement, disclosed on Tuesday, includes the sale and leaseback of the 12.5-hectare beachfront property located in Mactan, Cebu, which is essential for the Emerald Bay development.

The restructuring enables PH Resorts to pay off a 3.1 billion peso bridge loan extended by China Bank in 2018. Notably, the company will continue to hold possession and utilize the property to complete construction and development of the Emerald Bay project. PH Resorts also retains the option to repurchase the land from China Bank, a strategy that reflects its favorable financial position of having more cash than debt on its balance sheet.

This agreement is part of the broader strategy by Uy’s company to secure new financing while managing substantial debts accrued during rapid expansion over President Duterte’s administration. Previous measures included reducing its stake in telecommunications firm DITO CME Holdings to meet capital expenditure obligations. The company’s market capitalization is currently reported at 991 million USD.

Additionally, PH Resorts announced the signing of a non-exclusive, non-binding Memorandum of Understanding (MoU) with Cebu-based AppleOne Properties, which may lead to an investment in PH Resort’s subsidiaries. AppleOne, known for developments like the Sheraton Cebu Mactan Resort and AppleOne Equicom Tower, aims to obtain a majority equity interest in the Emerald Bay project. The two parties have 60 days to reach a final agreement.

Financial analyst Gabriele D. Aguila from Unicapital Securities expressed optimism regarding this potential partnership, viewing it as a timely opportunity for PH Resorts to bridge financial gaps following a failed investment plan earlier this year.

Following the announcements, PH Resorts’ share price saw a spike, increasing by over 8 percent to 0.67 pesos per share. The company continues to seek further resources to advance the Cebu casino project after unsuccessful negotiations with Bloomberry Resorts Corp.

In the first half of 2023, PH Resorts reported total assets of 18.8 billion pesos against liabilities of 14.1 billion pesos, which includes 6.1 billion pesos in loans. Losses for this period rose to 1.1 billion pesos, up from 333.1 million pesos a year earlier, largely due to interest expenses. The economic downturn, intensified by the COVID-19 pandemic, has prompted the company to sell assets, including logistics firm 2GO Group Inc. However, recent data indicates a 30.27% revenue growth over the last twelve months up to Q2 2024, suggesting a potential recovery.

This report was generated with AI assistance and reviewed by an editor.