Century Entertainment International Holdings Limited – Strategic Operating Agreement with WPT for Asia Pacific Mobile Gaming Expansion

Key Highlights

• Century Entertainment International Holdings Limited (“Century Entertainment”) announced its JV Company has entered into a significant Operating Agreement with WPT, a PAGCOR-accredited electronic gaming platform provider.
• This agreement enables the JV Company to access WPT’s proprietary gaming platform, technology, and content to develop, operate, and monetize up to ten mobile gaming applications (“Apps”) targeting the Asia Pacific region (excluding the Philippines).
• The partnership leverages WPT’s regulatory infrastructure and gaming licence, allowing Century Entertainment to expand rapidly in the digital gaming market with minimal upfront capital commitment.
• Revenue from the Apps will be shared, with WPT receiving 15% of Gross Gaming Revenue (“GGR”), payable monthly.
• The agreement is initially set for three years, with automatic one-year renewals unless terminated by either party with 90 days’ notice.
• There are clear regulatory compliance mechanisms, including PAGCOR certification, KYC/AML checks, responsible gaming requirements, and robust data sharing arrangements.
• As a connected transaction, the agreement is currently exempt from further disclosure requirements under the Listing Rules, but this may change if annual payments exceed HK\$3 million.
• Trading in Century Entertainment’s shares remains suspended since 26 June 2025, with further updates pending.

Detailed Analysis for Investors

Strategic Partnership to Accelerate Digital Gaming Growth

The newly announced Operating Agreement between Century Entertainment’s JV Company and WPT marks a strategic move to capture growth opportunities in the Asia Pacific digital gaming market. WPT, as a licensed and PAGCOR-accredited Electronic Gaming System Service Provider, will grant the JV Company access to its advanced gaming platform, content, and supporting technology. This will enable the JV Company to efficiently develop, customize, deploy, and monetize a portfolio of up to ten mobile gaming applications for markets across the Asia Pacific (excluding the Philippines), while remaining compliant with all relevant regulations.

Key Terms of the Agreement

• Term: The Operating Agreement is effective for an initial three-year period, automatically renewing for successive one-year terms unless either party provides at least 90 days’ written notice to terminate.
• Scope: The JV Company receives a non-exclusive, non-transferable, and revocable licence to WPT’s gaming platform strictly for developing, operating, and monetizing the Apps.
• Revenue Sharing: WPT will receive 15% of GGR generated from the Apps. Payments are settled monthly, with detailed revenue calculations submitted within 10 business days after each month, followed by prompt invoicing and payment in USD.
• Regulatory Compliance: WPT guarantees valid PAGCOR accreditation and compliance with all associated technical standards (e.g., RNG certification, return-to-player ratios, system security, audit trails). WPT is responsible for KYC/AML checks, responsible gaming measures, and all PAGCOR reporting. The JV Company must ensure compliance with laws in each operating jurisdiction.
• Data Access: WPT will provide the JV Company with secure, real-time operational data (player activity, transactions, GGR, performance metrics), while retaining data ownership. The JV Company is granted a royalty-free licence to use this data for App management.
• Termination Rights: Either party may terminate for material breach (with 30 days to remedy), insolvency, regulatory requirement, or for convenience with 90 days’ notice.
• Governing Law and Dispute Resolution: Philippine law applies, with disputes resolved via arbitration at the Philippine Dispute Resolution Center, Inc.

Financial and Shareholder Impacts

• Consolidated Financial Results: As the JV Company is a subsidiary, its financials (revenues net of WPT’s 15% fee) will be consolidated into Century Entertainment’s accounts.
• Limited Capital Expenditure: No significant upfront capital investment is required, as the JV Company leverages WPT’s existing platform, content, and regulatory approvals.
• Scalable Revenue Model: The revenue-sharing structure aligns the interests of JV shareholders and allows Century Entertainment to tap into online gaming growth with limited risk and capital exposure.

Regulatory and Listing Rule Considerations

• WPT owns 49% of the JV Company, making it a connected person at the subsidiary level. However, as the Directors consider the terms fair, reasonable, and in the Company’s interests—and since expected annual payments to WPT are below HK\$3 million—the transaction is currently exempt from further disclosure or independent shareholder approval requirements.
• If the payments exceed HK\$3 million in any financial year, the Company will comply with additional reporting and approval procedures under the Listing Rules.

Continued Suspension of Share Trading

Trading in Century Entertainment’s shares has been suspended since 26 June 2025 and will remain so until further notice. Investors should monitor further Company announcements for updates on trading resumption and business developments.

What Investors Should Watch For

• Commercial Performance: Actual financial impact depends on the commercial success and market acceptance of the Apps, ongoing regulatory developments, and competitive dynamics in target jurisdictions.
• Regulatory Changes: Any material changes in gaming regulations or PAGCOR’s stance could impact operations.
• Potential Share Price Sensitivity: The Company’s ability to generate sustainable revenues from the Apps, regulatory compliance, and updates on trading suspension are all potential share price movers.

Conclusion

The Operating Agreement with WPT positions Century Entertainment for accelerated entry into the Asia Pacific digital gaming market with limited risk and capital outlay, leveraging a robust, accredited platform. Shareholders should pay close attention to updates on the Apps’ launch and performance, regulatory developments, and the status of trading suspension, as these factors may materially affect the Company’s valuation and share price.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors should conduct their own research or consult professional advisers before making any investment decisions. The information herein is based on publicly available disclosures as of the date of the announcement and is subject to change without notice.

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