Jeju casino promoter raises $35m through bonds

Lotte Tour Development, a promoter for a new casino project on Jeju Island, has raised US$35.4 million via convertible bonds.

South Korea.- Lotte Tour Development Co Ltd. is promoting a new foreigner-only casino on Jeju Island, South Korea, and has announced it has raised US$35.4 million on convertible bonds through a third-party placement. Money “will be used for purchasing a Jeju foreigners-only casino licence and working capital” for the Jeju Dream Tower Integrated Resort project.

As reported by GGRAsia, “the non-guaranteed convertible bonds have a three-year duration and carry a zero percent coupon and a 1 percent yield to maturity and conversion price at par of [US$7,35] without any discount.”

Timefolio Asset Management was the main participant with US$19.48 million, alongside Pine Asia Asset Management (US$7.52m), Shinhan Investment (US$4.42m), KB Securities (US$2.65m) and IBK Asset Management (US$1.32m), while Mirae Asset Daewoo Co Ltd acted as the arranging bank.

“The successful issuance of convertible bonds with an exceptional condition – despite the financial market uncertainty due to North Korea’s nuclear crisis – is a result of high growth potential of Jeju Dream Tower Integrated Resort, which will become a key tourist attraction in Jeju,” said the promoter.

Lotte Tour Development will be targetted at Chinese tourists and will include an hotel, a foreigner-only casino and a shopping mall. It will all be located at a 38-story building that will be 169 meters high and is set to become the tallest building in Jeju once its completed near September 2019, as the backers estimated.