Okada Manila Since the Failed 26 Capital Deal: $200M+ in Losses and "No Clear Recovery Path"

How the casino that 26 Capital tried to acquire has performed since 2022—and what that means for SPAC shareholders who got their money back

The Financial Picture

Since the proposed 26 Capital SPAC merger with Okada Manila did not close in late 2022, the Philippine integrated resort and its parent company Universal Entertainment have posted severe financial deterioration.

Metric 2023 2024 2025 Trend
Universal Entertainment Net Income Positive -$102.8M loss ~-$90M loss (projected) Deteriorating
Okada Manila GGR PHP 44.5B PHP 34.8B (-21.8%) PHP 27.8B (-20.1%) Accelerating decline
VIP Gaming Revenue — PHP 11.1B PHP 6.2B (-44.3%) Collapse
Operating Profit — $19.8M (-90.1%) Further decline Near zero
Adjusted EBITDA (Okada Manila) PHP 12.3B PHP 7.6B (-37.8%) PHP 4.3B (-43.7%) Collapsing
S&P Rating B B- (downgrade) B- Downgraded
Fitch Outlook Stable Negative "No clear recovery path" Negative

Credit Agency Assessments

S&P Global Ratings downgraded Universal Entertainment from 'B' to 'B-', citing slow recovery prospects for Okada Manila.

Fitch Ratings revised its outlook to negative, stating: "unexpectedly weak financial results in 2024 and the absence of a clear near-term recovery path" for Okada Manila.

What Drove the Decline

The Counterparty's Governance Crises

Beyond financial deterioration, the counterparty has faced serious governance failures:

2017

Founder Kazuo Okada ousted for misappropriating millions. Tokyo Supreme Court later confirms he committed fraud.

May 2022

Okada leads armed group to physically storm and seize control of Okada Manila during SPAC merger negotiations. Manages casino for 3+ months before courts intervene.

April 2024

Tokyo High Court rules CEO Jun Fujimoto breached fiduciary duty by transferring $43.5M without authorization. Steps down from all roles.

September 2024

Universal Entertainment creates Governance Committee "to stamp out director misconduct in wake of Okada, Fujimoto cases."

What This Means for 26 Capital Shareholders

The proposed 26 Capital merger would have valued the combined company at approximately $2.6 billion. Instead of closing that merger, the SPAC's trust mechanism returned $10.95/share to public shareholders—above the $10 IPO price.

If Merger Had Closed (Hypothetical)

  • Holding shares in a company that lost $102M in 2024
  • Further $90M+ loss projected for 2025
  • S&P downgrade to B-
  • Fitch: "no clear recovery path"
  • VIP revenue down 44% in a single year
  • Governance by leaders found to have committed fraud and breach of duty

What Actually Happened

  • Trust distributed to shareholders
  • $10.95/share returned (above $10 IPO)
  • ~$275 million in total returned
  • No exposure to ongoing losses
  • No exposure to governance crises
  • SPAC structure worked as designed

Jason Ader's Position

Jason Ader, who led 26 Capital, was the single largest lender to the SPAC. He invested more of his own money than anyone trying to close the deal. When the merger failed, he lost more than any other individual.

The subsequent Chapter 11 filing was a corporate proceeding to wind down remaining obligations—not a personal bankruptcy. An independent trustee was appointed because Ader held dual roles (largest creditor and sole director), which is standard practice to avoid conflicts of interest.

The Bottom Line

Sometimes the best deal is the one that doesn't close. 26 Capital's trust mechanism protected shareholders from what has proven to be a deeply troubled company—one whose leadership includes individuals found by courts to have committed fraud and breached fiduciary duties, and whose financial results have deteriorated dramatically since 2022.

The shareholders who received $10.95/share are significantly better off than they would have been as stockholders of a company that has lost nearly $200 million and is facing credit downgrades with "no clear near-term recovery path."

Sources