Millions in “unpayable” debt could cripple Macau Legend

Macau satellite casino operator Macau Legend Development (MLD) has posted losses for 2024 totalling HK$667.23 million (£66.7 million/€80 million/$86 million), up from just HK$4.9 in 2023.
Net liabilities of HK$2.51 billion, including loans of HK$2.41 billion, “will be due for repayment within the next 12 months”, MLD acknowledged in a 28 March filing.
Past failure to comply with “certain loan covenants” has rendered loans of HK$2 billion “immediately repayable if demanded by the creditor banks”, MLD added. The Macau-based firm said those loans “may not be repayable. Even the current HK$166.4 million in default is unlikely to be repayable.”
The cash crunch casts “significant doubt on the group’s ability to continue as a going concern”.
Kicked out of Cabo Verde
Established in 1997, Macau Legend operates Macau Fisherman’s Wharf, touting it as the “largest leisure and entertainment complex on the Macau Peninsula”. A casino inside the Legend Palace Hotel operates under the SJM Holdings concession.
The group once had global aspirations. But in 2023, MLD president and CEO Li Chu Kwan announced the group would withdraw from overseas gaming projects to focus on core operations in Macau. In December of that year, it sold its Savan Legend casino in Laos for HK$303 million, citing “increasingly onerous restraints” that limited profitability.
At the time, Macau Business reported that profit from the sale was “likely to strengthen the group’s cash flow, enhancing its liquidity”.
But no such luck. Late last year, the West African nation of Cabo Verde severed an almost decade-long relationship with MLD, accusing it of “flagrantly and repeatedly” violating its obligations related to a planned HK$2 billion casino complex.
In 2015, MLD signed a deal to build the 160,000 sqm project in the capital city of Praia. But according to Macao News, development “did not proceed beyond some empty, rudimentary structures”.
In November 2024, Cabo Verde prime minister Ulisses Correia e Silva accused MLD of contractual violations including “transferring, without authorisation from the government of Cape Verde, the ownership of more than 20% of the share capital” of the venture.
He also referred to “convictions… of shareholders, administrators and others with rights and responsibilities in MLD”.
In April 2023, a Macau court convicted former MLD co-chairman and majority shareholder Levo Chan of illegal gambling and money laundering. Chan was sentenced to 14 years in prison. He was also ordered to repay HK$780 million to the Macau government and five of the city’s Big 6 casino concessionaires.
Survival depends on lenders
Now MLD is at the mercy of lenders. The Friday filing said its survival hangs on “the group’s ability to generate sufficient financing and operating cash flows”.
“This would only be possible via continual support from the lending banks to not take actions to demand immediate repayment of outstanding borrowings as a result of non-compliance with loan covenants.”
The group said it is “actively seeking support from the banks for the restructuring of the group’s outstanding installments due in 2025. The group is further seeking support from the controlling shareholder and substantial shareholders to not request repayment of shareholders’ loans of HK$339.4 million.”
Finally, it noted, it is “undertaking mitigating measures, including a cost control programme”.