Saipan Casino in Northern Mariana Islands Fields Acquisition Interest

Posted on: August 29, 2024, 11:23h. 

Last updated on: August 29, 2024, 11:32h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

A Northern Mariana Islands-based law firm that represents one of the primary lenders for the bankrupt and shuttered Imperial Pacific Saipan casino resort says it’s fielded interest about a possible takeover.

Imperial Pacific Saipan casino Northern Mariana Islands
The Imperial Pacific Saipan casino resort is seen during construction in 2018. The bankrupt and shuttered casino resort in the Northern Mariana Islands is reportedly peaking acquisition interest from a private US-based investor. (Image: Bloomberg Businessweek)

The Dotts Law Office represents a major creditor in the failed ultra-luxury integrated casino resort scheme that was envisioned by Chinese billionaire Cui Lijie. Attorney Michael Dotts revealed to the Saipan Tribune this week that Imperial Pacific International (IPI), the bankrupt entity that’s under liquidation, needs to immediately produce material that will allow creditors to field the best bid possible for an acquisition of the property located in the US territory.

A proper procedure needs to be put in place so that other investors can obtain due diligence material. IPI is in possession and control of material needed for potential purchasers to consider the investment,” Dotts said.

“These materials include blueprints, construction inspection reports, permits, construction contracts, and estimates of what it will cost to complete the building. ‘A bid package’ should be assembled,” Dotts explained.

Bidding Procedures

Dotts didn’t reveal who is behind the potential acquisition, but says his client was offered $10 million. Dotts has advised his client to reject the offer in favor of IPI being required to publish bidding materials and hold a competitive auction.

Dotts has suggested a blind, sealed bidding process, with a beginning price of $10.3 million. The attorney says a bidding period should run for 90 days. He’s also supportive of allowing interested firms to have access to the property to conduct their own inspections.

“It is in the best interest of the Commonwealth of the Northern Mariana Islands and of all creditors who reside here that not only the highest price is obtained for the property, but that the purchaser actually completes the project,” Dotts concluded.

Imperial’s Imperil Downfall

Cui was an early investor in one of the largest junket groups in Macau. More than a decade ago, she and her son, Ji Xiaobo, founded IPI and embarked on an ambitious plan to build and open a $3.9 billion casino destination in the Northern Mariana Islands.

IPI obtained the lone gaming concession in the commonwealth, but the scheme encountered considerable hurdles soon after.

The FBI raided the resort’s construction site after a worker died in 2017 and reports about unsafe working conditions and many workers from China being trafficked to work in slave-like conditions and low pay were documented. The US Department of Labor ultimately ordered IPI to pay $13.9 million in back wages.

The $550 million first phase of the sprawling luxury resort — highlighted by the resort’s lobby dragon art structure that featured more than 2.5 million Swarovski crystals and a fleet of Rolls-Royce vehicles — opened in 2017. The casino reported unthinkable play in its first six months, with gross gaming revenue of more than $1 billion.

The casino was questioned for enabling money laundering after records showed it was facilitating over $2 billion a month in VIP bets on just 20 table games to make it among the world’s richest casinos.

Imperial Pacific’s gaming numbers were about a third of what Wynn Macau reported during the same period. But Wynn Macau has nearly 200 table games, Michelin-starred restaurants, easy access to a major international airport, and global name recognition.

Getting to Saipan from any major country/city is a grueling trip. From Hong Kong or Macau, flying to the Northern Mariana Islands is a more than five-hour flight. From Manila in the Philippines, it’s a seven-hour flight.

COVID-19 travel restrictions led to the Saipan casino’s downfall. After the VIP guests who visited the resort were confined to mainland China for several years during President Xi Jinping’s “zero-COVID,” IPI failed to fulfill its financial obligations to the Northern Mariana Island government.

The company eventually filed for bankruptcy, a decision that reportedly cost Cui more than $1 billion.