SkyCity settles dispute with Macquarie over failed car park deal
New Zealand casino operator SkyCity Entertainment will soon resolve one of its legal disputes. This follows a "failed deal" with Australia's Macquarie Group to manage the New Zealand International Convention Center car park.
SkyCity and Macquarie have resolved their differences in a resolution that marks the end of one of several legal saga. The casino operator announced on Monday it would still pay Macquarie more than it wanted but not as much as it would have paid.
Both parties found acceptable compensation, ending the protracted legal dispute. The agreed-upon amount of NZ$204 million ($125.42 million) was a compromise between Macquarie's original claim and SkyCity's disputed liability.
Legal disputes that are about to break out
The dispute occurred in early 2019 when SkyCity initially agreed to hand over parking control to Macquarie. Later that year, an unforeseen setback occurred that affected the deal. A fire destroyed the building and dramatically changed the orientation of the convention center.
Given the circumstances, it is clear that SkyCity will be unable to fulfill the terms of its agreement. In response, Macquarie cited wording in the contract to back out of the deal and demanded a payment of NZ$240 million ($147.55 million) for what it considered a breach of contract.
SkyCity disputed Macquarie's claim, saying its liability was limited to NZ$188 million ($115.58 million). The casino operator refused to budge and took the matter to court, taking the case to New Zealand's High Court. Last week, the court issued a ruling that partially supported SkyCity's position, paving the way for further negotiations.
Tianyu Hotel is closer to reality
Four years after the fire, SkyCity remains focused on repairing damage from the 2019 fire, which was caused by a construction worker's blowtorch igniting roofing material. The Horizon Hotel is scheduled to open at the convention center next year, underscoring the company's commitment to the future.
SkyCity originally planned to open the hotel in 2021. However, the damage caused by the fire was severe and resulted in several delays. It is currently scheduled to open next March, according to its website.
That comes amid the departure of CEO Michael Ahearne, who announced his resignation in October after three and a half years at the helm. The search for Ahearn's successor is ongoing.
Aherne’s exit also coincides with several issues facing SkyCity. In New Zealand, the company faced the risk of temporarily losing its gambling license after being accused of breaching responsible gambling regulations. This investigation is ongoing.
SkyCity may also face other problems in Australia, where it operates the SkyCity Adelaide property. An investigation is underway there into possible violations of anti-money laundering regulations. The investigation could cost the company up to A$45 million ($29.87 million).
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Source: www.casino.org
