Melco International Development on Tuesday announced it will provide consultancy services for a casino project on Jeju Island in South Korea.
According to a filing to the Hong Kong Stock Exchange, its subsidiary, Melco Gaming Assets Management (Korea) will provide the consultancy services to HK-listed New Silkroad Korea.
As a consultant, Melco Gaming will provide New Silkroad Korea with “consultancy, advisory and technical services, including with regard to the building, equipping and fitting-out of the casino and the preparation and organisation of the casino’s marketing activities. The services also include the provision of intellectual property and know-how.”
In a press release, Su Bo, chairman and executive director of New Silkroad, said, “The strategic partnership with Melco will enable New Silkroad to benefit from the extensive experience and expertise of the respected international gaming brand, through its participation in the design and early-stage development of our mega-casino.”
Clarence Chung, executive director of Melco, said, “We are delighted for Melco to participate in this exciting project in South Korea with New Silkroad. Leveraging our strong experience and proven track record of creating and operating world-class integrated entertainment and leisure resorts across different geographies such as Macau, Manila and Russia, Melco can bring professional concepts and practices to New Silkroad’s project and enhance Jeju’s tourism appeal on a global stage.”
A technical services fee of US$5 million will be paid to Melco Gaming for the first three years.
The fee will be satisfied by the issuance of 22,605,000 new shares from New Silkroad to Melco Gaming, at an agreed issue price of HK$1.7 (US$0.2) per share.
The new casino is expected to be completed within three years.
New Silkroad entered the South Korean gaming industry through the acquisition of Development Golden Beach Co. Ltd in December, 2015.
New Silkroad holds a 72 percent equity stake in Golden Beach, which holds one of the eight gaming licenses on Jeju Island.