In New York and the firm behind the Resorts World Catskills casino resort has reportedly been hit with a lawsuit over claims that it is attempting to go private against the wishes of some of its minority shareholders.
According to a Wednesday report from the Times Herald-Record newspaper, the legal complaint against Empire Resorts Incorporated was lodged with the Sullivan County branch of the New York Supreme Court by marginal stakeholder David Mullen in an effort to halt a deal that could see Genting Malaysia Berhad and an affiliate purchase all of the American casino company’s outstanding shares at an individual price of $9.74.
The newspaper reported that the lawsuit from the New Jersey resident is seeking class-action status and names Empire Resorts Incorporated as well as board members Emanuel Pearlman, Keith Horn, Nancy Palumbo, Gerard Ewe Keng Lim and Edmund Marinucci as defendants. The legal action purportedly moreover lists majority shareholders Kien Huat Realty III and Genting Malaysia Berhad as subjects of the proceeding and is thought to encompass a claim for unspecified damages.
The Times Herald-Record reported that Kien Huat Realty III and Genting Malaysia Berhad via their Hercules Topco LLC holding company already own some 86% of the shares in Empire Resorts Incorporated and agreed a deal in August that is to see them buy out the remaining group of minority stakeholders.
However, Mullen is reportedly unhappy that the board of Empire Resorts Incorporated, which opened its Resorts World Catskills in upstate New York in February of 2018, has already endorsed the proposed transaction without providing the minority shareholders with sufficient information as to how they arrived at the $9.74 share valuation. He is furthermore purportedly concerned that the deal may have undervalued his investment and that the whole affair could have scared off other potential third-party offers.
The proposed share transaction was due to be finalized before the end of the year while Empire Resorts Incorporated and Genting Malaysia Berhad have so far refused to publicly comment on the lawsuit.