‘Referendum threat turned off investor’

Senate vice president Victor Hocog (R-Rota) said yesterday that the investor group that invited and paid for his and other CNMI officials’ trip to Hong Kong and Macau months ago was put off partly by a threat of a casino referendum even after a Saipan casino bill already became law and the bad publicity about legalizing casino gaming so it didn’t apply for a license to exclusively develop a casino resort on Saipan.
Meanwhile, the Lottery Commission will meet on Thursday afternoon to formally tackle for the first time the two Saipan casino applications that the Inos administration hopes would help spur economic activities in the CNMI after years of stagnation.

Hocog said Esteem Capital had planned to invest close to $3 billion in the CNMI for an integrated casino resort development.

With Esteem Capital not participating in the Saipan casino application process, it has not indicated whether it will pursue investing in other projects in the CNMI, Hocog added.

Esteem Capital’s recent partnership with the China-Australia Entrepreneurs Association Inc. and Zelong Group to invest $5 billion in a casino resort in Australia may have also been part of the reason why it dropped the Saipan plan, but Hocog said there was no mention of this project.

“They were a bit discouraged but the interest they showed I think let others know that Saipan has a good potential for a casino industry. I’m thankful there’s two other investor groups willing to invest in the CNMI. I don’t think anyone would put in $1 million [nonrefundable application fee] and not work hard to ensure that they get the exclusive license,” Hocog said in an interview on Capital Hill.

Hocog was referring to casino applicants Marianas Stars Entertainment Inc. and Best Sunshine International Ltd., both with separate investment ties in Hong Kong and Macau, among other places.

Both applicants have only six days or up to May 5 to deposit $30 million each in an escrow to be further considered for a grant of an exclusive casino license.

That $30 million would be the source of funds to restore CNMI retirees’ deferred 25 percent pension cut.

Lottery Commission chair Sixto Igisomar and other panel members will meet on Thursday, May 1, at 1:30pm in the governor’s main conference room on Capital Hill to discuss these two casino applications.

While the first few portions of the commission meeting will be open to the public, the executive session would be strictly for the commissioners only.

Rep. Lorenzo Deleon Guerrero (Ind-Saipan) said yesterday he’s hoping that the Lottery Commission would allow for public comments prior to going into executive session.

Gov. Eloy S. Inos earlier said that the commission is considering hiring a Macau-based casino investigator and gaming consultant to help review the applications before them.

The governor said the decision on which investor group will be granted a Saipan casino license is entirely on the Lottery Commission.

The Lottery Commission consists of the attorney general, the Finance secretary, the Commerce secretary, and the Public Safety commissioner.

Because of non-disclosure clause, the commission or the government won’t be able to disclose much of the applications’ contents unless the information were independently sourced.

Marianas Stars Entertainment, an indirect subsidiary of Chinese Strategic Holdings Ltd., plans to build a 2,000-room hotel including dining and shopping facilities in addition to developing a casino. Only 25 percent of Marianas Stars is owned by Mega Stars Overseas Ltd., the new owner of Tinian Dynasty Hotel & Casino. Owning 75 percent of Marianas Stars is Famous Treasure Ltd., a company incorporated in the British Virgin Islands and a wholly-owned subsidiary of Chinese Strategic Holdings Ltd.

Hong Kong-based Best Sunshine International Ltd., meanwhile, is a wholly-owned subsidiary of First Natural Foods Holdings Ltd. It has not been incorporated in the CNMI nor has it applied for a business license in the CNMI as of yesterday. It proposes to change its name to “Imperial Pacific International Holdings Ltd.” to provide a better identification for the company as it further diversifies its business, including adding eco-tourism and gaming to its portfolio.

Whichever of the two investor groups is granted a license to exclusively operate a casino on Saipan is required to build a hotel-resort with at least 2,000 rooms and an initial investment of $2 billion.