Mohegan Tribal Gaming Authority is pushing back against Bain Capital’s takeover of its South Korean integrated resort, arguing that the move is not in the best interests of the property, employees, customers, or other lenders. The dispute underscores the financial and operational complexities surrounding the multi-billion-dollar development, which was envisioned as a premier gaming and entertainment destination in Asia.
Bain Capital Takes Control Amid Financial Tensions
Bain Capital, the main lender to MGE Korea Limited, seized control of Inspire after accelerating its mezzanine loan. This move effectively handed the U.S.-based private equity firm operational control of the resort, which opened its non-gaming facilities in November 2023 and launched a foreigner-only casino in February 2024.
Mohegan, however, is pushing back. The company maintains that while the resort has faced “near-term hurdles” typical of large-scale projects, the essential elements for long-term success are in place. It argues that Inspire simply needs more time to reach its full potential.
Financial Covenant Dispute Heats Up
Mohegan acknowledged it had fallen short on certain financial covenant tests but was quick to clarify that it has not missed any principal or interest payments. The loan from Bain Capital isn’t due until May 2027, with no required principal payments before then.
In a statement, Mohegan revealed it had made multiple “good faith proposals” to modify the loan terms in line with industry norms. However, Bain Capital reportedly rejected these offers and instead sought conditions that would prioritize “large payments ahead of other Inspire lenders.”
The casino operator sees this as an aggressive move, suggesting that Bain Capital is leveraging the situation for financial gain rather than acting in the best interests of the resort’s long-term growth.
Mohegan’s Broader Commitment to South Korea
Beyond the immediate dispute, Mohegan is highlighting its broader contributions to South Korea. Since securing its casino license in 2016, the company says it has played a role in job creation, economic development, and regulatory compliance.
Mohegan emphasized that its approach is based on family ownership values, which prioritize regulatory integrity, public safety, and community engagement. The company insists that these principles were key reasons why South Korean authorities awarded it the license in the first place.
Negotiations Remain Open, But Uncertainty Looms
Despite the ongoing dispute, Mohegan says it remains open to dialogue with Bain Capital. The company reiterated its willingness to negotiate in good faith, hoping to reach a resolution that benefits all parties involved.
“We have been and will continue to attempt to negotiate in good faith with Bain Capital to find a mutually agreeable solution,” Mohegan said.
At the heart of the conflict is a significant financial burden. As of December 31, 2024, Mohegan’s Korea Term Loan had a face value of $460.7 million, with a book value of $436.9 million. Additionally, a separate Korea Credit Facility, set to mature in 2025, held a face value of $685.9 million and a book value of $669.5 million.
While Mohegan has acknowledged difficulties in meeting some financial performance targets, it maintains these issues are not related to any failure to meet payment obligations at Inspire.
The coming months will likely determine the fate of Mohegan’s South Korean ambitions, as negotiations with Bain Capital and interactions with local regulators shape the future of the multi-billion-dollar resort.
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