Imperial Pacific International (IPI) has filed a request with the US federal bankruptcy court to approve the sale of its hotel casino and other real estate assets to businessman Loi Lam Sit for $10 million.
According to the local media outlet Marianas Variety, IPI, through its attorney, Chuck Choi, has asked the court to approve the proposed competitive bidding and sale procedures for these major assets.
Choi has also requested a hearing on November 20th, 2024, to consider the final approval of the sale of IPI’s property, free of liens and encumbrances, to Loi Lam Sit—the “stalking horse” bidder—or to a higher bidder.
A “stalking horse purchaser” is a term that describes an initial bidder selected by a bankrupt company to make the first offer on its assets. This bid establishes the minimum price that the assets can be sold for in a bankruptcy auction. The term “stalking horse” reflects the role of the initial bid in setting a benchmark, encouraging other potential buyers to place higher offers.
Loi Lam Sit, a Hong Kong resident, is the general manager of Top Pride International Ltd., a wholesale distributor of cosmetic products.
IPI’s major real estate assets include its casino, located within its hotel building, which sits on approximately 19,204 square meters of land leased from the CNMI Department of Public Lands (DPL) under lease agreement. Additionally, IPI holds an ownership interest in Imperial Pacific Properties LLC, which has leasehold rights to eight lots adjacent to the leased property.
IPI filed for Chapter 11 bankruptcy in the District Court for the NMI on April 19th, 2024, citing debts exceeding $165.8 million.
Attorney Chuck Choi noted that IPI operated a casino for four years until the COVID-19 pandemic forced its closure in March 2020.
Hotel construction halted in 2021, and since then, the hotel has been exposed to the elements and is now in poor condition.
The estimated cost to complete the hotel construction ranges from $100 million to $150 million.
The proposed closing date is set for seven days after the court issues an order approving the sale motion. All sale transactions must be completed by December 31st, 2024.
IPI’s attorney explained that the company believes the proposed bidding procedures offer a crucial and tangible benefit to the estate. These procedures establish the framework for assessing the value of the assets at a public auction. The auction’s terms and conditions are designed to help the trustee secure the maximum value for the assets, ensuring that the process serves the best interests of both the estate and the creditors.
