Macau’s Suncity shares halted, pending statement on ‘possible loan default’ By Reuters

By Donny Kwok

HONG KONG (Reuters) -Trade in shares of Macau’s Suncity Group Holdings Ltd and its unit Summit Ascent Holdings Ltd were suspended on Thursday, pending a statement in relation to a possible loan default.

Alvin Chau, Suncity’s CEO as well as the founder of Macau’s biggest operator of junkets that bring in high rollers to play at casinos, was arrested last month over alleged links to cross-border gambling.

Suncity shares were halted pending an announcement “in relation to a possible loan default by an associate of the controlling shareholder of the company and possible enforcement of securities charged,” Suncity Group said in a statement.

Earlier this month, Chau’s junket operations closed all of its VIP gambling rooms in Macau in the wake of his arrest.

Chau’s junket operations, also called Suncity, are estimated to have accounted for a quarter of Macau’s gambling revenue.

The closure of Chau’s gaming rooms is expected to exacerbate pain for casino operators in the gambling hub and is expected to lead to closures in parts of Suncity Group such as restaurants, bars and hotels.

Macau’s gaming regulator has also ordered junket operators in the former Portuguese colony to stop offering credit to customers, according to brokerage firm Bernstein.

With Chau’s arrest, Macau and mainland Chinese authorities are adopting a zero-tolerance approach to the promotion of gambling in mainland China where it is illegal.

In tandem, they are seeking to rein in the flow of Chinese gambling-related funds into Macau and other gaming hubs – outflows that China last year deemed a national security risk.