Iao Kun Group Holding Gives Detains On Jeju Sun Hotel & Casino Acquisition

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Iao Kun Group Holding Company Limited ("IKGH")
IKGH
, which operates through its subsidiaries and related promotion entities that act as VIP room gaming promoters and a collaborator, today provided additional details on its announced acquisition of the Jeju Sun Hotel & Casino in Jeju, Korea. Consideration and Financing The acquisition consideration includes the real property, on which the Jeju Hotel & Casino is situated, as well as a non-expiring gaming license, which allows for an unlimited number of gaming tables that may be installed, subject to regulatory approval. IKGH shall be the first Macau gaming operator to have a gaming license in Jeju, and ownership of the gaming license will be an additional valuable asset for IKGH as it can be transferred to other potential locations in Jeju. IKGH expects to finalize its funding arrangements for the acquisition within the next few weeks. The company expects hotel and gaming operations to generate positive cash flow post-acquisition. Further, IKGH believes that the funding structure to be finalized should cause the acquisition to be accretive to earnings per share. Selecting Jeju IKGH has consistently noted that it has been seeking to diversify its operations outside of Macau. After a comprehensive review of opportunities, the company focused its efforts on the rapidly expanding market of Jeju, Korea. Jeju provides excellent accessibility from the Chinese Mainland, with many daily flights from the major Chinese cities. In addition, all Mainland Chinese can travel to Jeju visa-free, making it an ideal destination for Chinese travelers and casino patrons. Jeju also has a low gaming tax rate compared to other jurisdictions (the gaming tax is paid net of junket commissions and other expenses and will be typically be below 15% of net gaming revenue). In addition, IKGH sees significant potential to rapidly grow VIP operations on the island, given that VIP gaming in Jeju is currently underdeveloped. Upon reviewing potential opportunities, IKGH determined that the acquisition of the Jeju Sun Hotel & Casino and obtaining the non-expiring gaming license was the optimal way to diversify outside of Macau given the quality of the property and its close proximity (five-minute drive) to Jeju International Airport. Hotel and Casino Management In order to ensure a successful and value-added acquisition, it is imperative to have the proper teams in place to properly manage the property and casino and provide the customer with a first-class experience. In addition to the Jeju Sun Hotel management team that will continue to run the property as previously discussed, IKGH is currently negotiating and is confident that it will have a deeply experienced professional gaming team in place to manage the casino operation post-acquisition.
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