Sun to raise its stakes in Latin American unit
SUN International said yesterday it would raise its stake in Latin Americafocused Sun Dreams to almost 65% from about 55% in its bid to expand its gaming and hospitality business abroad.
Stiff competition, fewer available casino licences and consumers feeling the pinch in Africa’s most industrialised nation have pushed the gaming group to broaden its horizons.
Sun International’s Latin American unit, Sun Latam, and its regional partner, Nueva Inversiones Pacifico Sur Limitada (Pacifico), would buy the 19.3% stake in Sun Dreams held by Chile’s Entretenimientos Del Sur Limitada (EDS).
They would also jointly acquire senior management’s shares in Sun Dreams, or about 0.6% of its issued share capital.
Sun Latam would pay $63m for its half of the stake, Sun International said, raising its holding in Sun Dreams to almost 65%. Pacifico’s stake would rise to 35%.
Sun Dreams was created last year when Sun International merged its Latin American business with Chile’s Dreams SA.
EDS told Sun International in March it wanted to launch an initial public offering (IPO) to list Sun Dreams in Santiago or New York, or sell its stake.
“Rather than proceed with the IPO, both Sun International acting with Pacifico elected to each acquire 50% of EDS’s shareholding in Sun Dreams,” Sun International said.
Sun Dreams, the largest gaming firm in Latin America, has assets in four countries, including Chile, Panama and Colombia.
It runs 13 properties that have six hotels, 25 restaurants, 6 500 slot machines and 33 table games.
“We will continue to explore all viable opportunities for expansion in the region. These include Peru as well as Brazil where licensed casinos may be introduced,” Sun International CEO Anthony Leeming said.
Shares in Sun International, down more than 26% in the year to date, had slipped 0.41% to R63.74 by midmorning yesterday.