The Chairman and controlling shareholder of the Hong Kong-listed LET Group, Andrew Lo, has revived plans to sell the company’s entire interest in the Russian-integrated resort Tigre de Cristal, located in the Primorye Economic Zone near Vladivostok.

LET Group Holdings Ltd, previously known as Suncity Group Holdings Ltd, is a China-based investment holding company with six key segments. The company develops and operates integrated resorts in the Philippines and the Russian Federation, manages travel-related services, provides consultancy for hotels and resorts, develops properties, and manages shopping malls.

EGM vote on sale:

According to details filed with the Hong Kong Stock Exchange, LET Group received a Requisition Notice from the nominee holder of shares owned by Major Success Group Ltd—wholly owned by Lo—requesting an Extraordinary General Meeting (EGM). This meeting aims to vote on a Disposal Plan to sell its 77.5% stake in Oriental Regent, which owns the entire issued share capital in Tigre de Cristal’s operating entity, G1 Entertainment Limited Liability Company.

A similar Special General Meeting has been requested for shareholders of Summit Ascent Holdings, a subsidiary of LET Group that holds the 77.5% stake in Oriental Regent. LET Group owns 69.66% of Summit Ascent, while Lo and Major Success hold 72.07% of LET Group.

Lo has previously attempted to sell Tigre de Cristal. An agreement was announced in January to sell the stake, but the Russian buyer later withdrew. This announcement led to significant fallout, with all directors of LET Group and Summit Ascent—except Lo—resigning their positions. Lo was reprimanded by Hong Kong’s Securities and Futures Commission for not following proper procedures. Some of the departed directors have since returned.

Impact of Russia-Ukraine conflict and sanctions:

In detailing the new Disposal Plan, LET Group explained that the ongoing conflict in Ukraine and the resulting sanctions imposed on Russia by the United States, European Union, and other allies have negatively affected its Russian casino interest.

“The escalation in the Russia-Ukraine conflict has a negative effect on the motivation and choices for international tourists to freely travel into and out of Russia, which affects Tigre de Cristal’s customer base,” the company stated, as Inside Asian Gaming reports.

“Sanctions have become more stringent and also apply to enterprises established or operated in Russia, such as G1 Entertainment. The risks arising therefrom include the ongoing Russia-Ukraine military conflict, sanction risks, supply chain risks, prohibition of fund transfer risks, lack of international tourism, currency risks and human resources risks, including the risk of foreign travel or recruitment restrictions which would impact on the Group’s ability to manage or monitor Tigre de Cristal’s operation.”

“Any escalation of political or operational risks faced by Tigre de Cristal may also have a domino effect on other businesses of the Company. Up to the date of the Requisition Notice, there is no indication on when the military conflict and the related sanctions will end.”

Assuming the proposed Disposal Plan is approved, which seems likely given Lo’s significant interest, LET Group would negotiate and enter into an agreement for the disposal of Oriental Regent and implement the disposal accordingly.

Under the terms of the Disposal Plan, the entire stake in Oriental Regent would be sold to an independent third party at a price no less than $92.8 million, which is 80% of the $116 million originally negotiated in the January deal.

The sale of Tigre de Cristal, LET Group stated, would allow the company to focus on its land parcels in Japan and, more significantly, on completing its $1.1 billion integrated resort development in Manila, Philippines.