Bain Capital assumes operational control of South Korea’s INSPIRE Entertainment Resort: Report

February 18, 2025

Bain Capital assumes operational control of South Korea’s INSPIRE Entertainment Resort: Report

Bain Capital has assumed operational control of INSPIRE Entertainment Resort in Incheon, South Korea, following financial difficulties faced by its parent company, MGE Korea Limited. According to reports, the move comes after Mohegan, the US tribal casino operator, revealed that its principal lender had taken action due to a default on a $275 million loan used to finance the $1.6 billion resort.

The transition follows Bain Capital’s decision to exercise its rights to take over MGE Korea, which owns INSPIRE. Bain Capital, which has been involved in the project since its early development, stated that the move reinforces its commitment to ensuring the resort’s long-term stability and growth.

No immediate impact on operations

Despite the change in management, the investment firm has assured that the transition will not impact employees, guests, or the daily operations of INSPIRE. According to reports, the existing management team will continue working alongside Bain Capital to maintain business continuity and implement measures to strengthen the resort’s position in the market.

Bain Capital has an established presence in South Korea and pledged support to improve INSPIRE’s financial performance and enhance guest experiences. The company believes the transition will provide the necessary resources to sustain growth and elevate the resort’s standing as a leading entertainment destination in Asia.

Mohegan faces financial challenges

Mohegan’s loss of operational control follows a breakdown in negotiations with lenders regarding the default on the Korea Term Loan. The company had previously acknowledged the default but maintained that it was unrelated to missed payments. Instead, it stemmed from a debt covenant violation tied to financial targets.

Over the past few months, Mohegan proposed amendments to the loan agreement to allow more time to meet financial targets, but none were accepted. With negotiations failing, Bain Capital and other lenders opted to accelerate the repayment demands, ultimately leading to the transfer of control.

INSPIRE’s performance and prospects

INSPIRE Entertainment Resort, formerly Mohegan INSPIRE, opened its non-gaming facilities in November 2023 and launched its foreigner-only casino in February 2024. Despite a slow start, the resort has gradually improved, recording its highest mass and premium mass table drop in December 2023.

Mohegan reported net revenues of $63.5 million for the December quarter, a slight increase from the previous quarter. However, the resort continued to operate at a loss, with an adjusted EBITDA deficit of $4.2 million, though this was an improvement from the $6.9 million loss recorded in the previous quarter.