Universal alleged for "suspicious activities" in a legal dispute with Ader's SPAC.
The parent organization of Okada Manila, Universal Entertainment, may have participated in suspected bribery activities to gain favor among Philippine authorities, suggests a pretrial filing in the legal dispute between the Japanese business and 26 Capital (NASDAQ: ADER), the SPAC led by Jason Ader.
The lawsuit claims that Universal also engaged in unusual tactics to regain control of the casino. According to the legal document, a senior company executive brought "heavy luggage" to a meeting with Martin Romualdez, the Speaker of the House of Representatives, violating ordinary course covenants.
These questionable actions might have started with a "coup" in May 2022 when Kazuo Okada, a Japanese casino mogul, and some associates gained physical control of Okada Manila, which breached parts of the agreement with 26 Capital. The Philippines Supreme Court had ordered TRLEI, a Universal affiliate, to change its board of directors back to its 2017 composition in 2021, which included a seat for Okada.
Emails Revealing Suspicious Actions
The pretrial brief reveals emails from 26 Capital implicating Universal executives in potential bribery in the Philippines.
An email from Kenshi Asano, the CFO of Universal, was sent to board member Hajime Tokuda in July 2022. It mentioned that Sato Nobuki was on his way to the Philippines the following day, carrying "heavy luggage." Tokuda replied, saying that after the "item" had been delivered safely, he would organize a meeting with Romualdez.
26 Capital also accused Hans Van Der Sande, the CFO of the operating company, of having access to real-time updates on the situation through a secret Hotmail account.
"As soon as this 'Philippine lobbying' — to use Defendants' own phrase — succeeded, Van Der Sande's mission became thwarting this deal, which would bring management reform, potential investigations, and US regulatory scrutiny," the brief reads.
Earlier this year, Universal and its affiliates tried to call off the SPAC merger, alleging "material breaches of the merger agreement and fraudulent conduct by 26 Capital," and that Ader had made misleading statements about the integrated resort.
Bribes Allegedly Sent to Philippine Officials
After Okada made an unsuccessful attempt to seize control of his named casino hotel, Universal opted for a more direct approach, allegedly involving the "heavy luggage."
These coded terms surfaced in clandestine internal emails and were only discussed at the highest level of UEC, the legal document continues. "Within three days of the 'item' being delivered, Parent and Operating Company Director Tokuda (who was also Mr. Van Der Sande's closest ally at Parent) met directly with Speaker of the House Martin Romualdez."
26 Capital and Okada Manila announced the merger plans in October 2021, valuing the gaming company at $2.6 billion.
Trying to Prevent the SPAC Integration
After retaking control of Okada Manila with the help of military personnel and police, Van Der Sande and Okada Manila President Byron Yip resumed their efforts to thwart the merger. They aimed to exploit the coup and the overall fragility of the SPAC market to persuade Universal board members to vote against the combination.
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Source: www.casino.org
