The collective net purchase consideration amounts to 664 million rand as well as the face value of any shareholder loans.
“The investment by MINT will be a combination of an acquisition of existing shares from the relevant Sun International subsidiaries and the acquisition of an interest in the operating management agreements,” [DATA SUI:Sun International] said.
“MINT will also commit to invest into those operations that require refurbishment in the short to medium term.”
The South African hotel group will dispose of 80 per cent of its Gaborone Sun, Kalahari Sands, Lesotho Sun and Maseru Sun and Royal Swazi and Ezulwini Sun assets, and 50 per cent of its Royal Livingstone and Zambezi Sun asset.
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It also indicated that it would continue to manage the casino operations situated at each of the African assets and that MINT would assume day-to-day management responsibility for the hotel operations.
However, this arrangement excludes its Zambia operations which will be jointly managed under a joint venture arrangement.
“The proposed transaction and the partnership with MINT in Africa are in line with Sun International’s strategy to optimise its capital allocation and resources,” said Sun International.
“The proposed transaction enables Sun International to remain invested in the 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.”
The company added that MINT would commit its pro rata share of new capital expenditure to realise the revenue potential of the African assets, thus giving Sun International more room to consider capital investment opportunities elsewhere.
“Going forward Sun International will be able to give greater focus to opportunities identified in Latin America and Asia, where MINT has a strong presence, as further key growth markets for its core casino business,” it said.
“In addition to the strategic rationale, the proposed transaction allows Sun International and its management team to increase their focus on those properties in its existing portfolio that are driving the group’s financial performance and strategy.”
Currently, the only African operation in which Sun International has an interest, excluding its South African operations, is its investment in the Tourist Company of Nigeria (TCN). However, it has indicated that it entered into discussions with MINT regarding a possible investment in TCN.