Jason Ader calls it 'compelling investment': Okada Manila casino-hotel valued at nearly twice EKR's Solaire
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Jason Ader calls it ‘compelling investment’: Okada Manila casino-hotel valued at nearly twice EKR’s Solaire

Former Wall Street analyst Jason Ader has pegged Okada Manila’s value at $2.6 billion, nearly double the market capitalization of bilyonaryo Ricky Razon’s Solaire.

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Okada Manila’s Japanese owner, Universal Entertainment Okada Manila, has agreed to infuse the local casino hotel in exchange for an 88 percent stake in Ader’s special purpose acquisition company, 26 Capital Acquisition Corp.

Ader, the youngest managing director in Bear Stearns’ history, is also coughing out $275 million in cash to Okada Manila in the merger (which would enable Okada Manila to get listed on Nasdaq) to complete the second phase of its expansion.

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“The SPAC is valuing Okada Manila at an equity valuation of $2.5 billion. This seems high given the current situation where casinos have just been allowed to reopen at 30 percent capacity,” said Abacus Securities in a report.

Abacus noted that Ader was valuing Okada Manila at nearly twice the $1.35 billion market capitalization of Bloomberry which runs the Solaire casino resort hotel.

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“It appears even more expensive given that BLOOM owns the Bloomberry for the land, the implied present equity valuation for Solaire itself (the structure and current operations) would be valued at only $650 million. Most of the valuation gap can be explained by the fact that Okada is much bigger. It has nearly three times as many gaming tables at present and more than three ties as many slots and electronic gaming machines,” said Abacus.

“The gap will narrow, however, once Solaire North is completed sometime in 2024 (no figures available). In any case, the new investors in Okada Manila probably have a very long investment horizon and were willing to value the integrated resort at such level,” Abacus added.

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Abacus noted that Okada Manila’s new investor was the founder of buyout firm Spring Owl Asset Management and has been credited in contributing to the turnaround of Las Vegas Sands while serving as its director.

“Okada Manila is the future of the gaming market in Asia and poised for tremendous growth. With its beautiful new facility, a desirable location in one of the fastest-growing gaming markets in the world, and potential for industry-leading margins and cash flow conversion, I believe the Okada Manila is an extremely compelling investment,” said Ader in a statement.

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