Both Sunwest and Worcester conduct casino and hotel operations in the Western Cape.
Sunwest’s primary assets include the GrandWest Casino, the Table Bay Hotel and a minority interest in the Cape Town International Convention Centre while Worcester operates the Golden Valley Casino in Worcester.
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“The proposed transaction represents an attractive investment opportunity for Tsogo which will provide [DATA TSH:Tsogo Sun Holdings Limited] with an interest in quality casino assets in an area where Tsogo has limited exposure. The proposed transaction is consistent with Tsogo’s growth strategy of allocating capital to attractive opportunities in the hotel and gaming sector,” said the Tsogo group in a statement.
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Currently, the two casino businesses are owned by a number of stakeholders such as hotel chain, [DATA SUI:Sun International Limited] and investments firm, Grand Parade Investments.
Tsogo will purchase a 14.9 per cent interest in Sunwest and Worcester from Sun International for 635 million rand and a 25.1 per cent interest from Grand Parade Investments for 1.55 billion rand.
After the implementation of the Sunwest and Worcester transaction, Tsogo will hold a 40 per cent economic and voting interest in each of the casino businesses as well as receive representation on both companies’ board of directors.
However, Tsogo will not have any operational responsibilities in Sunwest and Worcester as both businesses will continue to be managed by their existing management teams.