Imperial Pacific International (IPI), a major casino operator, faces serious financial scrutiny as two solvency lawsuits in Hong Kong have been filed against it amid impending delisting from the casino plans of the Commonwealth of the Northern Mariana Islands (CNMI).
IPI Holdings Limited, the parent company of IPI and operator of the Imperial Palace casino in Saipan, announced that it is “actively surveying its alternatives and soliciting expert advice.” This move followed the presentation of two solvency petitions accusing the Hong Kong-listed company of failing to pay judgment amounts.
One of these petitions, which alleges the company’s inability to pay a judgment of HKD20.8 million (US$2.66 million) along with accrued interest and costs, was issued on September 14 by Guan Chubin. A date for hearing this case has been set for November 22, 2023.
A subsequent petition, presented by Wang Yi on October 3, cites the company’s failure to resolve a judgment of HKD5.3 million (US$677,700), plus interest and costs. A hearing for this case is anticipated on December 6, 2023.
Although IPI Holdings hasn’t disclosed the identities of the petitioners or the details of the judgments, the pattern indicates the company’s mounting liabilities stretching back years amounting to tens of millions of dollars.
The company warned its shareholders that it might find itself liquidating if the solvency orders are approved—a possibility it had already suggested a year prior. If the company were required to cease operations in Saipan, any transition of its property or assets—including any share transfers or alteration in membership status—would be declared null and void subsequent to the ruling.
The company’s future hangs in the balance with two board members exiting earlier this week. The Board of Directors is currently reassessing the petitions’ impact on operations along with the company’s overall financial position.
IPI’s issues aren’t confined to the lawsuits. The Commonwealth Casino Commission (CCC) of the CNMI, which has been left in a virtually bankrupt state by the casino operator, is eager to revoke IPI’s license due to numerous agreement breaches by the company.
In 2021, the gaming authority lodged five separate charges against IPI for disregarding its financial commitments. These included an annual license fee of $15.5 million, a regulatory fee of $3.1 million, and compulsory contributions to the community benefit fund in 2018 and 2019.
The CNMI had already suspended IPI’s license in April 2021, citing the company’s history of violations and non-payment. Despite this, IPI has maintained its stance for another opportunity, attributing its longstanding issues—some of which trace back to 2017—to the COVID-19 pandemic.