New deal “less ambitious”
Tsogo Sun is moving forward with plans to buy a 20 percent stake in two Sun International subsidiaries that operate casinos in the Western Cape, according to the Casino News Daily.
In 2015, the two companies were forced to cancel a deal in which Tsogo Sun would have paid R2.1 billion (US$137 million) for a piece of the GrandWest and Golden Valley casinos, two Western Cape gaming halls owned by Sun International.
But the country’s Competition Tribunal nixed that deal, which would have given Tsogo Sun a stake in all five casinos in the Western Cape. The new deal is “less ambitious,” according to CND. Tsogo Sun expects to pay R1.3 billion (US$85.3 million) for the one-fifth share. It presently has a controlling interest in three casinos in the region: Mykonos Casino, the Caledon, and Garden Route.
Sun International will maintain control of its two casinos and continue a partnership with Grand Parade Investments. CND reports that the latest deal will probably pass muster with officials, because it is considered a simple acquisition of an interest and not notifiable under the Competition Act.
Under the terms of the proposed transaction, Tsogo Sun would acquire a 10 percent stake in SunWest International and Worcester Casino for R675 million. An additional 10 percent interest in both would be acquired through Grand Parade Investments, again for a total of R675 million.
