Leisure casino and hospitality group Sun International announced on Monday that the company has entered into a broad-based black economic empowerment (BEE) transaction that will result in 7% of the issued share capital of Sun International being owned by a group of historically disadvantaged individuals.
The deal includes Sun International staff and black management. It forms part of Sun International’s empowerment undertaking to the North West Development Corporation in 2003 and will take black ownership in the group’s operations to more than 25%.
Sun International said its new BEE partner will be newly created investment holding company Dinokana Investments. Dinokana will pay a consideration of R392-million for its 7% interest in Sun International, valued at approximately R604-million.
The lead BEE partner in Dinokana will be Lereko Investments, with a 28,05% stake in Dinokana, resulting in an effective 1,96% interest in Sun International.
Other BEE parties are individuals and groupings with a link to the North West province, and the Sun International Employee Share Trust, with a 43% shareholding in Dinokana, through which it will acquire an effective 3,01% stake in Sun International.
Dinokana will raise the R392-million via preference share funding from Nedbank Limited on market-related terms and conditions, the hotel and casino group said.
Two Dinokana directors, Lulu Gwagwa and Valli Moosa, South Africa’s former minister for environmental affairs and tourism, have been proposed for appointment to the Sun International board of directors.
According to the company, the transaction is expected to lower its headline earnings per share by 3,7% to 514 cents from 534 cents before the transaction, while the weighted average number of shares in issue for adjusted headline earnings per share will rise by 4,1% to 108,799-million from 104,5-million previously. — I-Net Bridge