Universal Entertainment Seeks $25 Million Loan for Nevada Plant
A Japanese gaming giant is financing a new US manufacturing site to diversify its revenue, though the move follows a painful exit from the state just two years ago.
Universal Entertainment Corp. has agreed to secure up to $25 million in loans to build a new manufacturing facility in Nevada. The board of directors announced the move on Friday, marking the first concrete step toward re-entering the US market. The funding will be provided by Aruze USA Inc., a wholly owned subsidiary, to a new entity specifically created to explore expansion in the United States.
The company is not yet committed to a specific location within the state, but the decision reflects a strategic shift driven by declining domestic markets in Japan and intensifying competition in the Philippines. According to reports from GN technics/gaming (en-US), Universal views this new manufacturing base as a critical "third pillar" for its business, aiming to stabilize growth by leveraging its existing intellectual property and manufacturing expertise in a larger market.
Financial structure supports long-term expansion
The loan agreement, reached last week, is expected to close by September 30 and remains effective through the end of 2035. This long-term financial commitment signals that Universal intends to make a sustained presence in North America rather than testing the waters with a short-term project. The company cites the availability of skilled labor and Nevada’s prominence in gaming regulation as key factors in choosing the state.
However, the path to re-entry is not straightforward. Universal acknowledges that applying directly for gaming licenses in the US involves rigorous suitability reviews of shareholders, directors, and key employees. These reviews are among the most stringent in the world and can take a significant amount of time, creating a potential delay before the company can fully operate and sell its equipment locally.
A return after recent bankruptcy
This move represents a second attempt for the company in Nevada. In 2023, Aruze USA filed for Chapter 11 bankruptcy protection and laid off approximately 100 employees. During those proceedings, the company sold its slot machine operations to Play Synergy for $7 million and its table-game assets to Interblock USA for $14 million. The current initiative seeks to rebuild the manufacturing capability that was previously lost.
Industry views regulatory environment favorably
Daron Dorsey, president and CEO of the Association of Gaming Equipment Manufacturers, noted that Nevada is a logical choice for the company. He highlighted the state’s proximity to North American vendors and its reputation as a fair but tough regulator. While the regulatory hurdles are high, they also provide a level of market stability that is attractive to major manufacturers looking to protect their brand integrity.
The trade-off for Universal is clear: while Nevada offers a robust market and skilled workforce, the company must navigate complex legal and regulatory processes that may slow down revenue generation. The success of this venture will depend on how efficiently the new subsidiary can manage these administrative timelines while establishing its physical manufacturing operations.
