Suntrust Considers Online Gaming Accreditation as Westside City Work Continues

Suntrust Resort Holdings Inc is considering applying for accreditation tied to online gaming operations in the Philippines as it works through a stockholder equity remediation plan. The Manila-listed company said the possible move is among several options being reviewed as it seeks to address its negative equity position.

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Filing Sets Out Options

The update was disclosed in a Tuesday filing to the Philippine stock exchange, which followed a bourse enquiry dated May 22 asking how Suntrust Resort planned to deal with the negative stockholder equity shown in its quarterly report for the period ended March 31. In response, the company outlined a six-point set of options.

Among those options is the possible application for accreditation as a gaming system administrator under the domestic online gaming licensing framework of the Philippine Amusement and Gaming Corp, or Pagcor. Suntrust Resort said its relevant project entity is considering that route, but also noted that the financial impact and final timetable for any application are not yet determinable.

The company said it will make further disclosures as developments warrant. That leaves the possible online gaming move as part of a broader set of remedial steps rather than a confirmed decision.

Westside City Progress

Suntrust Resort has a role in developing the under-construction main hotel casino at the Westside City complex in Manila. The company issued their latest statement that the commercial activities at the location will be opened by the third quarter of 2026.

The Westside City development project is stated as a project worth US$1.25 billion. In September last year, Suntrust Resort was announced to be taking on a minority role in the scheme as it explored an agreement with Travellers International Hotel Group Inc regarding the completion of the Manila complex.

Travellers International said in mid-September last year that up to US$450 million was still required to complete the Westside City casino resort. Those figures highlight the scale of the project still being managed as Suntrust works toward opening.

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Equity Deficit Explained

In amended first-quarter unaudited results published on May 25, Suntrust Resort reported positive net income of just under PHP17.0 million, or US$275,400, compared with a net loss of PHP84.3 million in the same period last year. Even so, the company posted a total equity deficit of PHP21.54 billion, which was roughly unchanged from the prior-year period.

In an accompanying document filed with the bourse, Suntrust said the negative stockholder equity position was due mainly to the accumulation of pre-operating, financing, and related costs during the prolonged construction and development phase of the Westside City complex. It also pointed to the accounting treatment of outstanding convertible bonds and advances from related parties as liabilities, pending conversion or restructuring.

The company said it expects those conditions to reverse as the project moves toward completion and commercial operation. It added that the start of commercial operations, together with dividends expected from operating profits on the company’s indirect interest in the project, should contribute materially to improving its financial position over the medium term.

Broader Remediation Plan

Aside from the possible Pagcor accreditation, Suntrust’s stockholder equity plan also includes the conversion of outstanding convertible bonds into perpetual convertible bonds. The company also mentioned an increase in authorised capital stock and additional equity fundraising.

That fundraising could include the introduction of external investors, as well as follow-on or rights offerings. Together, the measures form part of a wider effort to address the equity deficit while the Westside City project moves toward completion.

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Source: GGR Asia