Macau Legend Development (MLD) intends to challenge Cabo Verde’s termination of a contract that originally called for the company to build a casino-resort in the African nation, according to a statement signed by chairman and CEO Li Chu Kwan.
Last week, the Hong Kong-listed company received a notice from Cabo Verde’s government accusing Macau Legend Development of “flagrantly and repeatedly” violating its obligations over a US$265 million tourism and casino development in Praia, the country’s capital.
On Friday, MLD’s board issued a statement saying that it was seeking legal advice on the appropriate course of action. The company also announced its intention to “vigorously contest” the allegations put forward by the government.
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Macao businessman David Chow signed an agreement with the Cabo Verde government in 2015 to build a resort comprising a casino, hotels, MICE facilities and a marina. While the first stone was laid in 2016, development of the 160,000-square-metre site has not moved beyond the construction of rudimentary structures that have remained empty ever since.
Cabo Verdean officials have refused to accept MLD’s claims that the Covid-19 pandemic had thrown a spanner in the works and slowed down its development plans. “The Covid-19 pandemic ended in 2021 and to this day, construction remains halted with no scheduled date for resumption,” the government’s official notice stated.
MLD, which owns the Macau Fisherman’s Wharf precinct on the Macau peninsula and operates a casino at Legend Palace on behalf of SJM Resorts, has been experiencing difficulties. In a regulatory filing earlier this year, its directors cautioned that MLD “might not be able to continue to operate as a going concern” if certain remedial “plans and measures” undertaken by the board failed to succeed.
