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Macau Legend Development Ltd, which has been experiencing challenges in its hotel and satellite casino services, raised approximately HKD93.0 million (US$12.0 million) in a rights issue, as it filed with the Hong Kong Stock Exchange on Thursday. However, only 49.49 percent of the rights shares offered were taken up by shareholders, with the remaining shares allocated to co-underwriters East Asia Securities Co Ltd and Platinum Broking Co Ltd. These unsubscribed shares amount to approximately 16.8 percent of the enlarged capital base of the company after the completion of the transaction. This is because the company has been experiencing difficulties, as indicated by the low uptake of the rights issue, which was offered on a one rights share for every two held basis, involving a total of 310,059,356 shares at HKD0.3 each. Net proceeds from the transaction, after fees and expenses, amount to approximately HKD86.4 million, which will be used for working capital to support the company in the challenging environment.
Funds Aimed at Capital Flexibility
The rights issue plan was first proposed by Macau Legend Resort in October of last year, and it was used as a means to improve the balance sheet of the company and to create opportunities for future developments. The infusion of funds is also timely since it will help the company meet its needs as it deals with the dynamic gaming market. The gross proceeds reached the targeted amount of HKD93.0 million, but the split subscription shows that investors are being cautious, with the underwriters filling in the remaining portion to facilitate its success.
Core Assets Hit by Policy Shifts
The Macau Fisherman’s Wharf tourism complex, located next to the Outer Harbour Ferry Terminal on the peninsula, was formerly operated by the company as a casino site in partnership with SJM Holdings Ltd. through a service contract for the operation of Legend Palace Casino. After November 12, 2025, the Legend Palace Casino ceased all operations according to the City of Macau’s mandate to discontinue all satellite casino operations before the end of 2025. This development has resulted in the loss of a vital source of funding. Fisherman’s Wharf is now a non-gaming attraction, but the loss is a reminder of the regulatory tightrope that is recasting the operator landscape in Macau.
Overseas Setback Adds Strain
Adding to the woes, the government of Cabo Verde has completed its acquisition last week of the stalled casino resort project of Macau Legend in Praia, the capital of the island nation. The group had already fully impaired the value of these assets in its annual report for 2024, acknowledging the non-viability of the project. This withdrawal from West Africa is a welcome relief from the troubled project but leaves a mark on the balance sheet. The first half of 2025 saw a net loss of almost HKD1.42 billion, led by a HKD1.27 billion impairment charge from satellite gaming writedowns.
Navigating Tough Financial Waters
Macau Legend’s path forward hinges on deploying rights issue funds wisely amid asset losses and market changes. The partial shareholder buy-in and significant underwriter role indicate challenges in rallying support, but the capital relief is welcome. With legacy business scaled back and offshore bets compromised, the group seeks stability through sound cash management in the evolving Macau environment.
Source: GGR Asia
