Okada Manila Responds to Capital's 'Desperate' 26 Lawsuits
Jason Ader's 26 Capital Acquisition Corp. (NASDAQ: ADER) called a recent lawsuit by casino's parent company "desperate." This company is trying to take Okada Manila public in the US.
The special purpose acquisition company (SPAC) has been sued by Okada Manila's parent company Universal Entertainment Corp. (UEC) and related parties in the Delaware Court of Chancery. The lawsuit accuses 26 Capital of rushing to bring the integrated resort public and possibly breaking US securities laws.
The countersuits are a desperate attempt to divert attention from UEC's own inappropriate actions. We look forward to proving them wrong at the trial in July, if the countersuits even make it that far, according to a statement issued Tuesday by 26 Capital.
The blank-check deal values Okada Manila at $2.6 billion, and if successful, would allow the casino-resort entity to trade on the NASDAQ under the ticker "UERI."
26 Capital Claims UEC Not Doing Required Work
In October 2021, 26 Capital and UEC announced their merger plans for Okada. Universal Entertainment, the Japanese pachinko giant, agreed to transfer 100% of Okada Manila's equity into the new company, while 26 Capital committed to giving $275 million in cash to the business.
Since then, the transaction has experienced several roadblocks, such as a 2022 physical takeover of Okada Manila by Kazuo Okada and his associates, more legal disputes, and an accounting controversy.
Now, 26 Capital alleges that UEC's countersuit is a way for the Japanese company to cover up the fact that it's not doing the work needed to finalize the merger.
"26 Capital sued UEC's affiliates in February because they weren't fulfilling their contractual obligations and avoiding necessary tasks to close the deal," said the SPAC in a statement.
Upcoming Events in Okada Manila Saga
The Delaware Court of Chancery may dismiss UEC's countersuit or rule in favor of 26 Capital, but it's unclear at this point. If the court rules to terminate the deal, which is what UEC seems to want, it will have to prove that 26 Capital committed unethical actions.
Alternatively, the court could find that UEC is purposefully delaying the process, putting 26 Capital's investors at risk.
26 Capital hopes to complete the transaction as it believes Okada Manila is growing, the venue is already profitable, and the deal could open doors for future expansion opportunities in the US and Asia-Pacific.
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