GGAM Alleges Undisclosed Incentive for Former PSE President

New court documents related to a lawsuit against Enrique Razon claim he had an undisclosed financial relationship with high-standing personnel at the Phillippine Stock Exchange (PSE) that had helped him block the sale of Bloomberry Resorts shares held by a casino operator.

Undisclosed Financial Relationship

Global Gaming Philippines (GGAM), a former business partner of Bloomberry Resorts Corporation, provided the documents which imply the former president of PSE was financially stimulated by the ports and gaming tycoon to prevent GGAM from divesting its stake at Bloomberry, following a rift with the Las Vegas-based asset management company.

GGAM filed a federal lawsuit in the US in March, seeking an arbitral award for the scrapped deal with Bloomberry to operate its Solaire Resort and Casino in Parañaque City just 6 months after the venue began operations in 2013.

GGAM claimed that the deal was terminated despite the substantial assistance it provided to Bloomberry for the development of the casino resort, seeking compensation for damages. Bloomberry’s chairman Razon responded by claiming GGAM had breached the agreement.

“GGAM has not spent any material time in attending to the management of Solaire and has failed to perform its obligations and deliverables under the [management services agreement].”

Enrique Razon, Chairman, Bloomberry Resorts Corporation

The lawsuit which claimed Enrique Razon was actively preventing GGAM from selling its rights in the Solaire Resorts and Casino project and was looking to enforce a $296.6 million arbitral award by a court in Singapore, also accused Razon of concealing assets through shell companies to avoid payment in case of a negative outcome from the arbitration.

The new court documents alleged Razon managed to block GGAM from selling its rights in the casino project after leveraging an undisclosed financial relationship between him and the former president of PSE Hans Sicat, under which Sicat was compensated for bringing investment opportunities to the second rich person in the Philippines and Bloomberry Resorts.

Singapore Court Ruling Blocked by Philippine Court

A month before the federal lawsuit, the Singapore Court of Appeals ruled in favor of GGAM, but Bloomberry immediately appealed the decision and argued that the arbitral award can only be enforced by a Philippine court.

GGAM also filed a lawsuit in Hong Kong after the Makati City Regional Trial Court issued a writ of preliminary injunction on its attempts to sell its Bloomberry shares with the arbitration still pending. In Hong Kong, GGAM filed against Deutsche Bank to compel the release of the shares subject to the injunction.