“All of us are of one mind,” Mr. Wynn told Reuters. “We cannot be related to activities in the Philippines.”
Las Vegas in Manila
When Mr. Okada and the Universal board approved the Manila project in August 2008, they projected it would be a cornerstone of a string of resorts around the rapidly growing Asian market. They expected Universal would become a $9-billion company by 2014 with a listing on the Hong Kong stock exchange, according to notes from the board meeting.
Casino gambling revenues in the Asia-Pacific region have more than tripled since 2007, according to PricewaterhouseCoopers. The region is set to overtake the U.S. market as largest in the world next year when gambling revenues reach $67-billion from $58-billion in 2012.
Universal’s first designs were based on the Wynn casinos, featuring two wings in reflective gold glass. Plans included $150-million to build one of Asia’s largest aquariums and a “Kidzania” playland, with another $70-million for the “Manila Eye,” a massive Ferris Wheel.
But Mr. Okada’s plans for a “six-star” resort were immediately tested by a litany of problems. Engineers discovered 10 hectares of its site was reserved for road use and held by another developer, making building impossible.
After months of delays, Universal called in Mr. Genuino to negotiate a land swap between Universal, the local city of Paranaque and developer Asiaworld Properties Philippine Corporation.
Around that time, Universal also rebuilt its legal strategy around Mr. Soriano in what was described in an internal memo as a “shift to Boysie.”
That meant reworking a structure that allowed it to circumvent the requirement that the landholding company behind the casino be at least 60-per-cent owned by Filipinos.
Records reviewed by Reuters show Universal had bankrolled the original investment meant to satisfy that foreign ownership requirement. This was done by depositing $4.4-million in a Banco De Oro account in 2008. That money secured a loan to a firm called Lex Development Corp., a shell company established by SyCip. Lex used the money to make its investment in the project. Universal covered interest on the loan, records show.
The holding was transferred in 2009 to Platinum Gaming and Entertainment, a Soriano-affiliated firm, records show.
Okada in charge
Mr. Okada remained in charge of key decisions involving Universal and the Manila project, current and former employees said. A transition began that put greater focus on a quicker return from a downsized project. Plans for the Ferris Wheel and other attractions that had promised to turn the casino into a tourist magnet were dropped or scaled back, people involved said.
The $40-million in payments from Universal began moving to Mr. Soriano on Jan. 14, 2010 with an initial instalment of $10-million transferred to the bank account of Subic Leisure and Management, a Soriano-controlled company registered in the British Virgin Islands. Another $15-million was transferred to Subic Leisure on March 3, 2010, internal records show.
Then in late April and early May 2010 Universal recycled another $10-million payment through the same Subic Leisure route.
The final $5-million was paid to a Hong Kong shell company of which Mr. Soriano was the sole shareholder.
Universal has filed two lawsuits against three former employees claiming the final $5-million and the $10-million that came back to Universal were not authorized. In rebuttals to the Universal lawsuits, two former executives said they had been following orders in making the payments.
In comes Aquino
At the end of June 2010, Mr. Genuino stepped down after a controversy erupted over his “midnight” reappointment by Ms. Arroyo. The election of President Benigno Aquino the month before posed potential complications for Universal.
Mr. Okada went to Manila to meet the new PAGCOR chief, Christino Naguiat, in August 2010. A month later, he hosted Mr. Naguiat at the Wynn Macau casino and covered $50,523 of expenses during a four-day stay. Mr. Naguiat has said there was nothing inappropriate about his stay.
Mr. Okada’s ambition to build casinos around Asia hinges in part on how the investigation of the Manila payments is resolved. The payments to Mr. Soriano are the subject of a Philippine Department of Justice investigation and two separate congressional hearings in the Philippines.
The Nevada Gaming Control Board said last month its investigation was progressing. Possible sanctions include a suspension of Universal’s gaming licence.
Earlier this month, Universal signed a deal giving Philippine property firm Robinsons Land Corp. a minority stake in its casino operating company and a majority stake in its Manila landholding company.
The Manila project – now known as Manila Bay Resorts after initially being dubbed “Okada Resort Manila Bay” – is scheduled to open in 2014, four years behind initial projections.Report Typo/Error