The planned merger of Chilean gaming firm Sun Dreams, a unit of Sun International and the gaming assets of casino and hospitality group Marina del Sol is in limbo after the parties failed to agree on a memorandum of understanding.
Sun International owns 64.94 percent of Sun Dreams, and Nueva Inversiones Pacifico Sur Limitada (Pacifico) holds 35.06 percent. Earlier this year they entered into a memorandum of understanding (MOU) with Clairvest and Empresas Valmar to merge the entities.
According to CDC Gaming Reports, the proposed merger would have enabled Sun International and Pacifico to propel Sun Dreams to critical mass in Latin America and lead to future business opportunities in South America, Mexico and the U.S. It would have helped to “mitigate future challenges and risks to the business and concentration of assets in any one country in Latin America.”
Sun Dreams operates several casinos, hotels, entertainment and food and beverage facilities in Central and South America. In a statement to shareholders in May, Sun International said the merger could lead to the listing of Sun Dreams on the Santiago Stock Exchange in Chile.
The deal was to have closed October 31, but on November 1, Sun International confirmed that the MOU had lapsed without an agreement. “The parties have agreed that they will continue to consider a potential merger which may result in a transaction at a later stage, in which event shareholders will be advised accordingly,” said a statement.
Meanwhile, the sale of a 14.94 percent stake in Sun Dreams to Pacifico has been delayed. The transaction will result in each company holding a 50 percent equity interest in Sun Dreams.
“Shareholders are advised that to date the parties have not yet received approval for the proposed disposal from the Superintendencia De Casinos De Juego, the casino regulator in Chile, by the long-stop date of October 31 2019. Sun International is engaging with Pacifico regarding an extension to this date,” Sun International said.
