Listed gaming and leisure group Sun International has submitted a written notice to the board of listed empowerment vehicle Real Africa Holdings, expressing its interest in buying the entire issued share capital of Real Africa for nearly R2,2bn, or R5,90 a share.
Real Africa's primary investment is a 66,2% stake in Afrisun Leisure Investments, which holds interests in a number of Sun International's subsidiaries: Carnival City, Sibaya Casino, Boardwalk Casino, Grand West Casino and Table Bay Hotel, the National Casino Resort Management Company and the Gauteng Casino Resort Management Company.
In a statement released yesterday, Sun International said Afrisun accounted for almost 75% of Real Africa's net asset value, and as such "an acquisition of Real Africa is predominantly an acquisition of minority interests in Sun International's existing operations".
"The proposed acquisition will create a single listed point of entry into the Sun International Group, while simultaneously increasing Sun International?s exposure to its own existing core gaming activities," the group said.
The group's R5,90 offer is at a 14,6% premium on Real Africa's closing price last Friday of R5,15c.
According to Sun International, Real Africa shareholders holding at least 25,6% voting rights, or 93-million shares, have indicated support for the deal.
The group said institutional shareholder Allan Gray has undertaken to recommend to its clients, which hold more than 90-million Real Africa shares (25% of the voting rights), to support the proposed acquisition.
The proposed transaction, which should be completed by the end of August, together with a potential restructuring of the underlying shareholdings in certain casino companies, could enhance the groups' empowerment status.
"In addition, there are limited expansion opportunities in SA for Sun International to develop new casinos or to acquire existing casinos," the group said.
Sun International said it would dispose of the other assets held by Real Africa within 12 to 24 months.
Business Day
Publisher: I-Net Bridge
Source: I-Net Bridge
