SVH seeking to recover second tranche of Vietnam settlement

Silver Heritage Group said it’s in talks with its former partner in Vietnam to recover the second tranche of a $5.25 million settlement reached after the termination of its management agreement to operate the Phoenix Club.

The second instalment was due in April, but so far the group has only received $0.5 million of the payment, it said in a release of Chairman James Spenceley’s speech to shareholders.

“We remain actively engaged with our former partner in respect of the payment of the outstanding balance and will pursue legal remedies under the termination agreement if necessary,” he said.

The company was informed in February that the Phoenix was no longer authorised to offer table games at its property. The loss of revenue from that operation has forced SVH to explore ways to release capital from its asset base.

“The board and senior management have been working hard with the assistance of its advisors to identify and progress discussions with third parties in respect of such solutions,” he said. “I am pleased to say that we have made progress on this and we are in advanced discussions in respect of several options in this regard.” 

The group said that its operations in Nepal — The Millionaire’s Club and Casino in Kathmandu and the Tiger Palace Resort in Bhairahawa are showing positive growth. 

Total Nepal revenue to end may was $6 million, up 46 percent, while costs were down 16 percent over the same period a year earlier. 

Gross gaming revenue at Tiger Palace up 52 percent to 2.6 million and was up 37 percent at The Millionaire’s Club to $2.7 million.

“We remain convinced of the long-term thesis of our Tiger Palace investment,” CEO Mike Bolsover told investors. “We have a truly world class asset in a region and location with strong fundamentals, including being situated just 15 minutes’ drive from an airport which is set to become Nepal’s second international airport in 2020.”

Spenceley also told investors that the group’s auditors were unable to offer an opinion on the group’s 2018 accounts and would be resigning once a new auditor is appointment. 

New Chief Financial Officer Ben Watiwat discovered irregularities in the company’s accounts resulting in an additional expense of $54,000.

Trading in shares of the company remains suspended.