Mohegan Tribal Gaming Authority has confirmed that, although it no longer owns the Mohegan INSPIRE Entertainment Resort in South Korea, it remains exposed to certain financial obligations that could persist until refinancing and management transitions are fully completed.
In February 2025, Bain Capital, a Boston-based private investment firm, exercised its acquisition rights for INSPIRE’s parent company, MGE Korea Limited. Following this, lenders led by Bain Capital assumed control of the resort on 13 February, prompting Mohegan to deconsolidate the business from its accounts and reclassify prior periods as discontinued operations.
As a result, Mohegan no longer holds equity in INSPIRE or its parent entities and will not benefit from the resort’s future performance. The move generated a $77.6 million (€70.6 million) gain on disposal for Mohegan. However, the company simultaneously recognised approximately $137 million (€124.7 million) in estimated guarantee liabilities tied to the project. The takeover followed the acceleration of a $275 million (€250.3 million) mezzanine term loan arranged in 2021 for MGE Korea Limited.
Bain discussions underway
Despite stepping away from day-to-day operations, Mohegan continues to face ongoing obligations. Discussions with Bain Capital remain in progress to fully transition duties under the 2021 management agreement. In the meantime, some Mohegan subsidiaries may continue providing services to INSPIRE until the handover is complete.
Under a Credit Enhancement Support Agreement, Mohegan agreed to provide up to $100 million (€91 million) of support for INSPIRE’s Korea Senior Credit Facility. This facility, which matures on 29 November 2025, may require amendment, extension, or refinancing if INSPIRE lacks sufficient liquidity to repay, a process Mohegan will not facilitate after the transition.
Reparations and loans remain
A separate backstop arrangement obliges Mohegan to reimburse Hanwha beyond KRW 3.75 billion (€2.55 million) per quarter for interest on a KRW 291 billion (€198 million) facility at a fixed rate of seven percent. The potential exposure under this agreement is roughly KRW4 billion (€2.72 million) through maturity. Mohegan is also required to maintain a KRW5.65 billion (€3.85 million) letter of credit with Hanwha.
In addition, the company has provided reparations to mezzanine lenders for customary “bad boy” acts, though no claims have yet been made. It has committed up to KRW 50 billion (€34 million) in additional equity if necessary to maintain minimum cash requirements and maintains a KRW 24 billion (€16.3 million) standby letter of credit with Incheon International Airport Corporation.
Mohegan stated that its base plan, filed in February 2025, does not anticipate further cash funding and that INSPIRE is currently in compliance. Furthermore, a 2023 letter agreement committed up to KRW30 billion (€20.4 million) of additional equity for pre-opening and construction costs, with dedicated funds covering these expenses. Some contractor disputes, however, remained unresolved prior to the February transition.
So, while Mohegan has exited the operational side of INSPIRE, the company continues to face contingent obligations and financial exposures that could affect its finances if INSPIRE or its lenders fail to meet commitments.
