- Details
- By Chez Oxendine
- Gaming
Financier Bain Capital has seized operational control of the South Korea-based INSPIRE Entertainment Resort from the Mohegan Tribal Gaming Authority (MTGA), throwing the future of the tribal operator’s flagship Asian venture into doubt less than a year after its opening.
The takeover follows mounting concerns about INSPIRE’s performance that emerged in MTGA's fiscal year-end report, where auditors expressed "substantial doubt" about the company's ability to continue as a going concern, citing significant debt maturities in 2025-2027 and covenant compliance issues with the Korea Term Loan.
On Feb. 13, 2025, Bain Capital, as principal lender, exercised its right to accelerate a $275 million Korea Term Loan agreement with the tribe’s wholly owned MGE Korea Limited subsidiary, demanding immediate repayment, despite the loan’s original May 2027 maturity date. When MTGA couldn’t comply, Bain moved to take control of the property through its security interest in 100% of MGE Korea Limited’s shares.
In a statement to Inside Asian Gaming, Bain Capital said the move would have “no impact on INSPIRE’s employees, guests or day-to-day operations. INSPIRE’s existing management team and Bain Capital are working closely to ensure business continuity while implementing enhancements that will strengthen the resort’s market position.”
In a Feb. 18, 2025 statement, MTGA maintained that it never missed any actual loan payments and said it had proposed several covenant amendments that aligned with market standards. However, the tribal authority alleged Bain rejected its proposals in favor of counteroffers that would have resulted in Bain receiving large payments ahead of other lenders.
“We do not believe the change of control pursued by Bain Capital is in the best interests of the property, its team members and customers, other lenders and various key stakeholders,” MTGA said.
The $1.6 billion INSPIRE casino, South Korea’s largest integrated entertainment resort, opened partially in November 2023, with its gaming phase launching in February 2024. The project helped the Mohegan Tribal Gaming Authority achieve record revenues of $1.9 billion in fiscal year 2024, but also contributed significantly to MTGA's net loss of $235 million for the year, leading to concerns about its ability to continue as a going concern. These concerns were primarily related to significant debt maturities in 2025-2027 and the covenant compliance issues with the Korea Term Loan, which ultimately led to Bain Capital seizing operational control of the property.
Though Bain now controls INSPIRE and is responsible for its financial future, INSPIRE remains burdened by the loan that enabled the takeover, and MTGA could still face financial exposure through its guarantees and commitments if INSPIRE fails to meet its debt obligations.
Despite the enormous challenges, MTGA remains committed to the project. “We’ve applied our operational expertise in areas like compliance, finance, and marketing, and will continue to work with Bain Capital to find a solution that supports our ongoing partnership with South Korea and stakeholders,” MTGA said in a statement.
Brian Edwards provided reporting.
