Thailand firm acquires Gaborone Sun
Brian Benza | Friday August 29, 2014 16:17
The global gaming and leisure company, which is looking to reduce its exposure to some African assets, has teamed up with Thailand-listed leisure conglomerate Minor International (MINT) in a R661million (P528 million) deal. The deal allows the South African Sun International to markedly reduce its exposure to three African hotels.
The mechanics of the deal will see Sun International selling the hotel businesses to the Asian leisure giants while it retains the casinos operations.
It will allow Sun International to reduce its maintenance and upgrading expenditure in hotels while still retaining the cashflows from managing several casino operations.
“Sun International has an economic interest of 80 percent in Gaborone Sun. Should approvals for the disposal be granted, this will reduce to 16 percent,” Sun International group general manager for corporate brand and communication, Michael Farr told BusinessWeek.
Under the terms of the deal, MINT will acquire majority holdings in the Gaborone Sun in Botswana, the Kalahari Sands in Namibia, the Lesotho Sun and Maseru Sun as well as the Royal Swazi and Ezulwini Sun in Swaziland.
Sun International will also reduce its 100 percent stake in the Royal Livingstone and Zambezi Sun in Zambia to 50 percent, with MINT holding the balance.
“The collective net purchase consideration for all the assets involved including Botswana amounts to R664 million plus the face value of any shareholder loans,” said Farr.
The proposed transaction is subject to the satisfactory receipt of all regulatory approvals, including the relevant gaming boards and competition authority approvals.
According to Farr, all the hotels to be acquired by MINT in Southern Africa will be rebranded to one of the Asian giants hotel brand, AVANI.
“In Southern Africa, the AVANI brand will be introduced on properties other than The Royal Livingstone which will remain as is,” added Farr.
The proposed transaction enables Sun International to remain invested in these African assets but with responsibility for the casino component only, as well as to partner with MINT in other African opportunities that have a casino element.
“Given that MINT does not operate or manage casinos and has no intention to, there is the basis for a natural partnership of complementary skills and strategy.
“Sun International will remain as a minority shareholder and partner in Botswana, and will continue to benefit in the future growth of this asset,” said Farr.
MINT is a global company focused on three primary businesses including hotels, restaurants and lifestyle brands distribution. MINT is a hotel owner, operator and investor with a portfolio of 110 hotels and serviced suites under the Anantara, AVANI, Oaks, Per AQUUM Elewana, Four Seasons, St. Regis, Marriott, Radisson Blu and Minor International brands.
Its hotel portfolio includes properties in Thailand, Australia, New Zealand, Maldives, Vietnam, the Middle East, Sri Lanka, China, Malaysia, Indonesia and Cambodia. In Africa it has invested in game lodges and hotels in Tanzania, Kenya, and Mozambique and the proposed transaction is a complementary fit to these assets. MINT is also one of Asia’s largest restaurant companies with over 1,500 outlets in 20 countries. It is also one of Thailand’s largest distributors of lifestyle brands such as Gap, Esprit and Tumi.