Alvin Chau Steps Down as Suncity Group CEO, as Stock Price Nearly Halved
Posted on: November 30, 2021, 11:34h.
Last updated on: November 30, 2021, 07:23h.
Alvin Chau announced from jail yesterday that he is stepping down as CEO of Suncity Group Holdings Limited, the Macau-focused gaming promotion company that made him a billionaire.
Chau is facing numerous criminal charges in Macau and Wenzhou city regarding his alleged orchestrating of illegal cross-border gambling in Asia. Authorities in the Zhejiang Province contend that Chau’s wealth has partially been derived from operating illicit online casino operations and advertising gambling unlawfully to Chinese people on the mainland.
As informed by Mr. Chau, he has indicated his intention to resign from the posts of the chairman of the Board and an executive Director of the Company,” Suncity informed investors through a securities filing made late last night with the Hong Kong Stock Exchange.
The company also alerted investors that Chau’s departure presents grave concerns for the group’s funding activities for its ongoing casino-resort developments in the Philippines, Russia, and Vietnam.
“Shareholders and potential investors of the Company are advised to exercise caution when dealing in the Shares,” the company declared. Suncity did not specify when Chau might officially step down.
Dark Days for Suncity
Investors heeded the warning from Suncity by exiting the company and selling off their shares in a mass exodus. Since Chau’s arrest in Macau, Suncity shares on the Hong Kong Stock Exchange have lost more than 48 percent of their value.
Chau has been personally lending Suncity much of its financing for its under-construction integrated resorts in the Philippines’ Entertainment City and in Russia’s Far East. Suncity is building a $1 billion casino and resort complex called Westside City Resorts World in Manila, and continues to expand its Tigre de Cristal casino in Russia’s Vladivostok.
With Chau soon departing the company that he founded in 2007 and served as its chief executive, the organization could be short on capital to carry on with its development endeavors.
“The Group is dependent on the financial support from Mr. Chau and his related companies,” the Suncity securities filing added. “In the event that the Group losses the support of Mr. Chau for whatever reason, the financial position, business, and operation of the Group will be adversely affected.”
Suncity Denies Wrongdoing
Another key component of the Suncity Group Holdings announcement is that the company claims it has no ties to the allegations facing Chau.
In Wenzhou, prosecutors allege that Chau — through his fully-owned Sun City Gaming Promotion Company Limited (SCGPCL) — engaged in proxy betting. Proxy betting involves gamblers betting on live table games remotely through mobile devices. A proxy is seated in an actual brick-and-mortar casino, and the gambler tells that individual how to play from a remote area. Such schemes are illegal in Macau and the Philippines.
Suncity Group says it has no control or influence over SCGPCL, and therefore has no legal responsibility regarding the Wenzhou allegations.
“The Board is of the view that, save … the potential risk of loss of financial support of Mr. Chau, the Incident does not have any direct material adverse impact on the financial position, business, or operation of the Group,” the company declared.
Related News Articles
Related News Articles
January 3, 2023 — 13 Comments—
January 12, 2023 — 11 Comments—