KUALA LUMPUR, 30 JUNE: Genting Bhd’s subsidiary Resorts World Las Vegas LLC is buying a Bombardier-built Global Express XRS aircraft from an entity linked to Genting Hong Kong Ltd for US$4 million (roughly RM16.62 million) as part of Genting Hong Kong’s ongoing sale of non-core assets to boost liquidity in the wake of the Covid-19 pandemic. The seller is the US-based Bank of Utah, which is the trustee of the N989SF Trust, of which Crystal Luxury Aircraft Holdings Ltd is the sole beneficiary, according to a filing with The Stock Exchange of Hong Kong Ltd yesterday.
According to the filing, Crystal, an indirect wholly-owned subsidiary of Genting Hong Kong, is the sole beneficiary of the trust under which the seller holds legal title to the aircraft.
“The board (of Genting Hong Kong) announces that on June 29, 2021, Crystal (an indirect wholly-owned subsidiary of the company, as the sole beneficiary of the trust), the seller (solely in its capacity as the trustee of the trust), and the purchaser entered into an agreement relating to the sale and purchase of the aircraft for a total consideration of US$4 million (equivalent to US$4 million),” Genting Hong Kong said.
“It is also envisaged that the disposal will save money on aircraft maintenance and operation.” The sale profits would be utilised as general working capital for the group (Genting Hong Kong),” according to Genting Hong Kong, which is a sister business to casino and hotel operator Genting since Tan Sri Lim Kok Thay is a significant shareholder in both companies.
The aircraft disposal is estimated to result in a loss of approximately US$6.45 million after taking into account the disposal net proceeds of roughly US$4 million and the aircraft’s carrying value of US$10.45 million, according to Genting Hong Kong.
“The actual amount of gain or loss to be reported by the group as a result of the disposal will be subject to review and final audit by the group’s auditor.” However, the sale is estimated to save Genting Hong Kong around US$3 million in engine repairs and roughly US$3 million per year in aircraft running costs,” the business stated.
According to Genting Hong Kong, Lim, who is considered to have a significant interest in the disposal, has refrained from voting on the relevant board motions.
“Lim is an executive director, a significant shareholder, and a corporate linked person” (Genting Hong Kong). Lim is a beneficiary of a discretionary trust whose trustee indirectly owns more than 30% of the equity interests in Genting Bhd (in its position as trustee of such discretionary trust). The buyer is a Genting Bhd indirect wholly-owned subsidiary.
“As a result, the purchaser is regarded an associate of Lim for the purposes of Chapter 14A of the Listing Rules, and is thus a connected person of the firm as defined by the Listing Rules.” As a result, under Chapter 14A of the Listing Rules, the disposal is a related transaction of the company,” Genting Hong Kong said.
Listed on the Bursa Malaysia Genting Hong Kong is not a subsidiary of Genting.
Genting shares were trading at RM4.97 at 11:55 a.m. on Bursa, up one sen or 0.2 percent, for a market capitalization of around RM19.13 billion.
According to Genting’s most recent quarterly financial report, the company has 3.85 billion issued shares. Continue reading
