South Africa’s biggest hotel and casino operator, Sun International, plans to buy rival Peermont Global for R9.4-billion. Peermont owns Emperors Palace near OR Tambo International Airport, Johannesburg, as well as 12 other leisure and gaming complexes. Sun International, which owns Sun City and was founded by Sol Kerzner in 1975, said it would issue 10.4 million new shares to finance the deal. Sun International investors will also take over all of Peermont’s debt, which includes R3.8-billion in existing debt. Peermont was bought by a private equity consortium led by the Mineworkers Investment Company in 2007 and delisted that year, but it soon began struggling to repay the debt for this deal at a time of falling gambling revenue with consumers under pressure. In November 2013 Peermont was “recapitalized” by raising R5.3-billion in new debt in a plan that the company said “will significantly enhance its long-term sustainability and allow for greater flexibility to pursue further growth opportunities”. Sun International said the deal would enable it to “undertake larger developments and acquisitions internationally”. But the company will be hoping prospects for the gambling sector improve markedly after a few tough years. Read more:
http://www.timeslive.co.za/businesstimes/2015/03/22/sun-international-bets-on-peermont
