GAMBLING: Grand Parade Conclude Restructure
Recent Western Cape Business News
Grand Parade Investments (“GPI”) said yesterday that the conditions of the restructure announced on 16 May 2011 and subsequently approved by shareholders on 14 September 2011 have been fulfilled and that the deal has become unconditional.
The restructure sees GPI reduce its shareholding in both GrandWest Casino and Golden Valley Casino (Worcester) to 25.1% and in terms of an offer by Sun International South Africa Limited to RAH shareholders, GPI will dispose of its 30.6% interest in RAH at an offer price of 422c per share.
The transaction has been a long time in the making and is a significant milestone for GPI and Sun International Limited (“Sun”). GPI Chairman Hassen Adams said: “The restructure was subject to a number of regulatory approvals which took some time to achieve. We are very pleased that all the hard work has paid off and that we can now focus our attention on GPI’s exciting future with greater certainty."
“The conclusion of the transaction is a significant moment for empowerment in South Africa. Through this transaction GPI is realising value for some of its assets which will enable it to pay a substantial dividend to its shareholders, the majority of which are broad based black South Africans. Once the deal has been implemented we intend making a special dividend payment of 60 cents per share, which is an increase of 10 cents on the amount previously suggested. The annual dividend of 10 cents due to be paid on 12 December 2011 remains unaltered.”
GPI will also be released from all empowerment lock-in obligations which will result in the unbundling of the GPI SPV Trust and BBBEE Trust, following which unit holders will receive GPI shares that they can trade freely. Richard Hoption, a member of GPI’s board, said: “The process of unbundling the empowerment trusts is well underway. The trusts have played a major role in GPI’s success and it will be extremely rewarding to issue shareholders with directly held GPI shares.”
Talking about GPI’s intentions regarding the remaining cash received from Sun International, Adams said: “We intend using a portion of the proceeds to reduce debt, but we are most excited about the attractive opportunities we are being presented with as a result of our strong balance sheet, black ownership credentials and the cash resources. We are taking a great deal of care in investigating these opportunities and will be expanding and developing our LPM business throughout South Africa and across the borders, focussing on technology betting and other gaming initiatives. We will also be venturing beyond the gaming footprint and will provide more details in the forthcoming months.”
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