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KUALA LUMPUR: Genting Hong Kong, hard hit by the Covid-19 pandemic, sold its subsidiary, the Zouk Group, operator of the popular nightclub, for HK $ 79.3 million (RM42.4 million).
The Singapore-based group was sold to Malaysian company Tulipa as part of efforts to ditch non-core assets and build liquidity for the cash-strapped company, The Straits Times reported.
The cash sale is expected to result in a profit of approximately HK $ 6.7 million.
Tulipa is owned by Lim Keong Hui, the son of Genting Hong Kong’s controlling shareholder, Lim Kok Thay.
Genting Hong Kong had previously suspended payments to creditors due to cash flow problems stemming from the Covid-19 pandemic. He said he had to use his available funds for services critical to the company’s operations.
Bloomberg reported last month that Kok Thay, chairman of the Genting group, had pledged almost his entire stake in Genting Hong Kong as collateral for loans after the company suspended payments to creditors.
Zouk is among the best nightclubs in the world. It was sold to Genting Hong Kong in 2015.
The Zouk Group, which also owns the Five Guys burger joint in Plaza Singapore, had a pre-tax loss of HK $ 79.6 million for the seven months to July 31 and had an unaudited consolidated NAV of approximately HK $ 72.6 million on the same date. , The Straits Times reported.
Genting Hong Kong owns the Star, Dream and Crystal Cruises brands, operates shipyards and has a stake in Resorts World Manila.
It made a net loss of $ 742.6 million in the first half of the year, due in large part to port closures that have forced cruise lines around the world to suspend travel since February, the report added.
Revenues for the six months were $ 226.2 million, down from $ 729.2 million for the same period last year. The Hong Kong-listed company owes $ 3.4 billion as of July 31, according to the report.
The company said it had started to implement measures, including cost reduction and loan deferrals, to have a “reasonable prospect” of meeting its financial obligations until June next year.
He said he had received interest in investing in one of his cruise brands.
Malaysian conglomerate Genting’s gambling and hospitality empire has been severely affected by pandemic-related restrictions, which have forced casinos to temporarily close and have put a hiatus in tourism around the world, the Straits Times added. .
