Imperial Pacific shelves bond offering

A bond offering that Imperial Pacific was planning to use to fund construction of its Saipan casino has been put on hold, according to sources speaking to Bloomberg.

The firm had planned to raise between US$200 million to US$400 million, but investors wanted a higher yield than the 10-11 percent that that company was willing to offer, said sources.

Last month, Moody’s Investor Service warned that the casino operator may see a downgrade in its credit rating.

The ratings agency said it was concerned with the lack of funding for its project to build a new resort on the island.

"The review for downgrade reflects our concerns over Imperial Pacific's lack of funding to complete its Grand Marina project due to a delay in the issuance of the company's proposed bonds," said Kaven Tsang, Moody's vice president and senior credit officer, at the time.

"The delay in the issuance could also trigger the risks of cost overruns and a potential termination of the company's gaming license," added Tsang.

"The former concern will potentially result in more debt funding and the company's debt leverage could then exceed the original budget."

As the investment is funded mainly by the proposed bonds, the delay in the bond’s issuance have meant major shareholders have been providing interim shareholder loans to keep construction going.

However, Moody said it was a temporary solution and falls short of the amount to complete the project.

With the bond offer now off the tables, Imperial Pacific loses a key source of funding for its casino project, said Bloomberg.

Imperial Pacific declined to comment on the status of its bond offering or its operations when asked by Bloomberg.

Alleged AML breach

A former employee at Best Sunshine International who was dismissed, has filed a suit in U.S. federal court last week alleging illegal practices, including failure to follow AML procedures.

Best Sunshine is a subsidiary of Imperial Pacific International Holdings Ltd, and operates a temporary casino on Saipan.

According to Bloomberg News, former casino manager Danny Ewing said the company had “failed to implement or enforce an adequate” anti-money laundering programme, and claims that management ignored complaints and reports of violations.

In one case, Ewing said Imperial Pacific allowed a customer to deposit $400,000 with the casino’s cashier without the required Anti-Money Laundering identification.

He is also suing Imperial Pacific for wrongful termination in violation of the Fair Labor Standards Act and Occupation Safety and Health Act regulations, immigration violations; wrongful failure to hire; and intentional infliction of emotional distress, according to a report from Saipan Tribune.

Ewing is demanding unspecified damages.

More news from this jurisdiction

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Fitch Ratings has downgraded its rating for Hong Kong-listed Imperial Pacific International Holdings Limited, after concerns it has still not yet secured sufficient long-term funding for the construction of its casino and resort.

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Saipan casino operator Imperial Pacific International Holdings has seemingly pushed back the opening of its new casino resort to the first quarter of 2017, deferring its earlier planned CNY opening.

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Imperial Pacific International Holdings has posted US$32.4 billion in unaudited VIP table games rolling chip turnover for the full-year 2016, according to the company’s filing to the Hong Kong Stock Exchange.

Pacific IslandsMonday, Dec 19, 2016

Saipan’s Labor Secretary Thomas E. Perez has requested for the federal court to issue a warrant to inspect the construction site of Imperial Pacific Resort in Garapan after an Occupational Safety and Health Administration was denied entry, Saipan Tribune reports.

Pacific IslandsMonday, Dec 05, 2016

Imperial Pacific’s temporary casino in Saipan raked in US$1.7 billion in VIP rolling chip for the month of November, according to its filing to the Hong Kong Stock Exchange.

Pacific IslandsTuesday, Nov 29, 2016

Imperial Pacific International Holdings Ltd., the operator of a casino in Saipan, may see a downgrade in its credit rating at Moody’s Investors Service.

Pacific IslandsThursday, Nov 24, 2016

Commonwealth Casino Commission officials have praised the efforts made by Imperial Pacific in hiring and training the local workforce in line with its employment plan and federal requirements.