The developer of the Westside City integrated casino is in talks to refinance or restructure debts after missing an interest payment on convertible bonds issued in the midst of the pandemic, raising funding concerns for the $1-billion gaming hub in the Manila Bay Entertainment City district.

Suntrust Resort Holdings Inc., owned by Hong Kong-listed LET Group Holdings (formerly Suncity Group Holdings), said in a Philippine Stock Exchange filing that it failed to pay interest on the P5.6-billion bonds issued to affiliate Summit Ascent Investments Ltd. on Dec. 30, 2020.

The debt paper has a coupon rate of 6 percent a year and can be converted to 3.11 billion shares at a price of P1.80 each. The shares are equivalent to about 30 percent of Suntrust.

"Prior to the due date of the interest payment, Sun and Summit Ascent have been earnestly discussing the terms of the refinancing and/or restructuring of the 2020 convertible bond," Suntrust said in the stock exchange filing.

"While no definite agreement has been executed as of date, Sun believes that an agreement on the terms of such refinancing/restructuring should be forthcoming," it added.

Sun was responding to an article by gaming-focused publication, Inside Asian Gaming, which reported the company missed a $6-million interest payment on the bonds.

"However, Sun has been accruing interest due and the accrual is reflected as part of due to related parties in the company's quarterly financial statements, which as of Sept. 30, 2022, amounted to P295.5 million," it added.

Suntrust earlier announced a target to open Westside City in 2024. The project will be the fourth gaming complex in Entertainment City after Solaire Resort & Casino, City of Dreams Manila and Okada Manila.

The now defunct Suncity Group was previously led by "junket king" Alvin Chau, who was arrested in 2021 and sentenced by a Macau court on Jan. 18 to 18 years in prison for illegal gambling operations.

LET Group told shareholders last August it was committed to "long-term investment in the Philippines" through the Westside City project.

"Philippines' phenomenal position in the sector based on its [gross gaming revenues] recovery pace, its pre-COVID growth track record, its supportive policies, its local demand, its high barrier to entry and its encouraging tax regime are the foundation of our belief that having a foothold in the Entertainment City opens the door to success in future Asian entertainment," the company's annual report showed. —Miguel R. Camus INQ