Posted on: June 13, 2022, 08:08h.
Last updated on: June 13, 2022, 01:06h.
Universal Entertainment, a Japanese manufacturer of pachinko machines and the parent organization of Okada Manila, is delaying its planned US listing on the Nasdaq.
Universal’s casino subsidiary, Tiger Resort, Leisure and Entertainment, Inc. (TRLEI), owns and operates Okada Manila. Universal has been planning an offering on the Nasdaq exchange to sell ownership shares in its $2.4 billion integrated casino resort in the Philippines.
But the recent chaos regarding TRLEI’s governance has prompted Universal to push back its US public listing. Universal explained in an investor release that the company’s merger with 26 Capital, a blank-check special purpose acquisition company led by SpringOwl Asset Management and Jason Ader, is delaying its deadline. It now expects to go public from June 30, 2022, until September 30, 2022.
The decision is in response to Japanese billionaire Kazuo Okada, who founded Universal TRLEI, built Okada Manila, and recently attempted to takeover the casino’s corporate governance. The 79-year-old claims he was wrongly ousted in 2017 from the companies he founded on baseless allegations that he was stealing money from the group.
An April “Status Quo Ante Order” from the Philippines Supreme Court instructed Universal/TRLEI to restore their board arrangements to their 2017 makeups with Kazuo in charge.
Scandal Delays Listing
Kazuo Okada claims he is the rightful chairman of the Philippines gaming companies. But Ader and the ousted TRLEI board say the Philippines high court order does not give the billionaire power over the group.
Ader and the TRLEI directors who were allegedly “forcibly removed” from their offices on May 31 say Kazuo’s son Takako Okada is Universal’s largest shareholder. The younger Okada, Ader says, is “totally against his father’s actions.”
Takako Okada was among the board members who voted in 2017 to remove his father from the organization’s power. TRLEI has filed criminal charges with the Department of Justice of the Philippines for the alleged offenses committed by the Kazuo-led group’s takeover of the Tiger Resort offices.
Universal, however, maintains that the scandal will not impede the company’s plans to merge with 26 Capital and offer Okada Manila shares on the Nasdaq.
Although the Company has extended the deadline of the Merger Agreement to September 30, 2022, there is no change to the schedule announced,” the Universal notice explained.
Ader’s 26 Capital has agreed to invest up to $275 million into Universal Entertainment as part of the merger. If the alignment goes through by September 30, the combined companies will trade on the Nasdaq under the ticker “UERI” for Universal Entertainment Resorts International.
Supreme Court Appeal
A statement from TRLEI board members who were ousted by Kazuo late last month requests the Philippines Supreme Court intervene and declare the billionaire’s actions unlawful.
“We are calling on all government bodies and agencies to only deal with the legitimate board of TRLEI,” Universal Entertainment Director Hajime Tokuda pleaded.
After the Supreme Court’s “Status Quo Ante Order” in April, TRLEI filed an “Urgent Motion for Reconsideration” with the high court. The court has yet to say whether it will take up the appeal.
“We likewise urge the Philippines Securities and Exchange Commission to fulfill their mandate and refuse any attempt of the illegitimate group to make a mockery of the corporate institutions in the Philippines,” Tokuda added.