Posted on: April 5, 2022, 05:40h.
Last updated on: April 5, 2022, 02:25h.
Imperial Pacific International reportedly has found a way to settle its debt with the Commonwealth of Northern Mariana Islands. This would allow it to retain its exclusive Saipan casino license and its hold on the Imperial Palace.
Only days after Casino.org reported that two New Jersey investors had their eye on the Imperial Palace casino, IPI says it found new money sources. Although it did provide a clue, it wouldn’t say who would be willing to risk hundreds of millions of dollars backing an inept company.
IPI’s controlling shareholder, former chair Cui Ji Lie, and others are willing to cover the company’s “operational needs, liabilities, potential liabilities related to litigation, the casino annual license fee and the social benefit fund and capital investments as and when necessary,” according to an IPI filing.
In addition, the company received a conditional offer for a $100-million credit facility from an unnamed financial entity. That credit line, however, will only be open until September 27.
Imperial Pacific International (IPI) has been through one failed experiment after another for several years. FBI raids, poor conditions for employees, and an endless string of lawsuits are just some of the examples. It owes millions of dollars and could permanently lose its license next month at a hearing.
Now, IPI is claiming it can rebound completely. It says it has found a way to cover its debts and earn ongoing revenue simultaneously. With the fiscal year 2021 delivering losses of $88 million on top of the $35 million it owes the government and the millions more it owes private companies, the backing would have to be substantial.
IPI Remains Committed to Saipan
IPI explained that an unidentified travel agency would underwrite 250 hotel rooms and 15 villas at Imperial Palace. The agreement will be valid for four years and will be worth $76.5 million annually.
There is also an arrangement with another company. It wants to operate a shopping mall at the casino, also on a four-year agreement, with IPI retaining 51% of the operation’s gross proceeds. This, it asserts, means another $2.5 million a year, even though there’s no way to gauge the amount of traffic.
Imperial Palace Construction Could Resume
Although IPI has a proven track record of not paying construction companies, it reportedly convinced “several” contractors to take over the completion of Imperial Palace. It asserts that these unidentified companies will ramp up construction and be done within 24 months after the CNMI lifts all COVID-19 restrictions.
Imperial Palace closed in September 2020 and remains closed today. However, the closure, a result of the global pandemic, only played a small role in IPI’s downfall. Its issues began three years earlier and never disappeared.
IPI is confident that its new sources of funds will be more than adequate to cover its outstanding debts, which will allow it to complete the development of the Imperial Palace. Its track record doesn’t substantiate those claims. But the assertion will buy the company more time.
CNMI casino authorities voted on a permanent suspension of IPI’s license next month. This could have led to the introduction of additional licenses. However, that hearing won’t lead to a definitive answer on IPI’s future. Instead, the company will likely present its financial information and convince officials to delay their decision.
The company has made a habit of introducing stall tactics at the right moment. It appears it will do so again, leaving Saipan’s casino future in limbo.