Buffalo, New York-based Delaware North has agreed to purchase for $137 million the Darwin, Australia casino owned by New Zealand-based SkyCity Entertainment Group Limited, an entertainment and gaming business that owns and operates casinos in New Zealand and Australia. In addition, the two companies announced a joint venture to establish an online casino platform based in the Northern Territory, if Australian law permits that within the next decade.
Under the terms of the sale, Delaware North will acquire 100 percent of SkyCity Darwin Pty Limited on a cash-free and debt-free basis, although SkyCity noted it will retain its adjacent Little Mindil property, which will be sold separately. SKYCITY also retained the right to access the VIP and premium gaming facilities at its Darwin, Australia casino for its international business customers for at least two years after the sale is finalized.
SkyCity purchased the Darwin property in 2004 from MGM Grand, and over the years has added a new hotel, pool, bars, restaurants and VIP facilities. SkyCity will continue to own and manage the Darwin casino as Delaware North obtains approvals the required by the Northern Territory government.
SkyCity Chief Executive Officer Graeme Stephens said, “We see both international business and the online space as future growth areas for us, so we see value in this outcome. The sale is consistent with our ‘capital lighter’ strategy to sell non-core assets and to allocate capital to assets and businesses which we feel are aligned with our long-term strategic objectives. As always, our top priority is to deliver attractive and sustainable returns for shareholders. It also allows us to concentrate our Australian activities in Adelaide, which is undergoing an $240 million expansion, due for completion in late 2020.’’
