PETALING JAYA: Genting Malaysia Bhd
’s (GENM) US incorporated subsidiary is being sued RM2.6bil (US$600mil) for alleged fraud by its joint venture (JV) partner.
In a filing with Bursa Malaysia, GENM said the complaint was filed by RAV Bahamas on Oct 7, 2024 before the US District Court Southern District of Florida and served on Genting Americas on Oct 11, 2024.
Without elaborating deeper into the issue, GENM said “the complaint is baseless and totally without merit” and it “will vigorously defend against the complaint.”
According to The Tribune, a news portal based in The Bahamas, Genting Malaysia’s indirect wholly-owned subsidiary, Genting Americas Inc is essentially accused by its JV partner, RAV Bahamas Ltd for using 78% majority ownership and management control to hide the transfer of hundreds of millions of dollars in liabilities incurred elsewhere in its global operations onto Resorts World Bimini’s (RW Bimini) books.
Genting Americas and RAV Bahamas Ltd jointly own BB Entertainment Ltd, with a 78%/22% interest split. BB Entertainment is in turn the Bahamian-incorporated holding company for Resorts World Bimini.
It was further stated that RAV Bahamas had transferred 20 acres of land to BB Entertainment, upon which Resorts World Bimini sits.
RAV Bahamas was reported having said that “the lawsuit seeks the damages that Genting Americas’ continuing fraud has caused, which include but are certainly not limited to rendering RAV Bahamas’ contribution to BB Entertainment - the 20 acres of land - entirely worthless.”
It was also stated that Ernst & Young accounting firm qualify BB Entertainment’s 2022 audited financials by noting that a “material uncertainty related to going concern” and that BB Entertainment had incurred a net loss for the year ended December 31, 2022, whereby the company’s current liabilities exceeded its current assets and registered a net equity deficit as well.
