The joint casino project partner of CapitaLand in Macau stated that the disagreements with New Cotai, the US business partner, had resulted to delays in getting approval to use the land.
Last Saturday, CapitaLand, the real estate developer, which owns a 20 percent share in the Macao Studio City project worth US$2 billion through a joint business venture with East Asia Satellite Television (eSun Holdings Ltd), said that it will work out with eSun to find solutions that will allow the venture to move on.
The firm also stated that if certain terms and conditions are not conformed to by September of the following year or on another date that may be agreed upon by both parties, it has a choice to put all its shares back to eSun.
In its statement on Friday, eSun stated that development for Macao Studio City was delayed because of the conflicting opinions of the two parties – the East and US-based partner New Cotai that owns a 40 percent stake in Cyber One, the joint venture company that is in-charge of the said project.
The government of Macau didn’t give Cyber One permission to make alterations to the land. The company was not also permitted to raise the site’s gross floor area to around six million sq. ft.
The government has requested the joint venture for information regarding the plans of the project. However, both New Cotai and East have still to prepare an agreed response.
According to East, the company is now ready to give Macau government its updated proposals on prospective construction and financing of the said project; however, it claimed that New Cotai has refused to formulate substantive response.
Still, both partners are looking for possible solutions, like selling of the entire or part of New Cotai’s interests, attracting new investors, and restructuring the existing interests of the parties.
“However, East recognises that a solution to the differences may necessarily involve litigation”, the company said.
Cyber One, with US$200 million contributed capital, has not yet secured adequate funding for the project’s development. Meanwhile, eSun believes that once the differences between the parties are resolved, the funds would definitely come in.