Two Gambling Giants to Merge

February 22 - A merger of two giants in the South African gambling industry will see the entry of a powerful new entity on the scene.

SABMiller, which owns Tsogo Sun, said that it would be merging the casino group with the JSE listed Gold Reef Resorts.

The latter owns prime gaming assets across South Africa.

SABMiller will effectively swap its 49% interest in Tsogo Sun for a 39.7% interest in the new gaming entity.

The Tsogo Sun/Gold Reef Resorts group will remain listed on the Johannesburg Stock Exchange and should realize capitalization of around R21 billion.

Tsogo Sun runs around 90 hotels in Africa and the Middle East and owns some of the biggest names in South Africa, including  Montecasino, Suncoast Casino, Emnotweni Casino and Caledon Casino.

Gold Reef Resorts is also a giant in its own right, enjoying interests in Gold Reef City Casino, Golden Horse Casino, Garden Route Casino and Mykonos Casino in the Western Cape.

The Chief Executive Officer of SABMiller, Graham Mackey said: "In 2002, we facilitated a landmark Black Economic Empowerment transaction by transferring our existing game and hotel assets into Tsogo Sun. We have been very satisfied with the development of our partnership with Tsogo Investments since then, and we are very pleased today to see it enter a new phase with this value accretive transaction, which has our full support."

The merger has been in the pipeline for some time now, as Tsogo Sun has been attempting to take full control of Gold Reef for over three years. Past attempts proved to be unsuccessful.

The new entity will become the 36th largest on the JSE and create one of the largest gambling and entertainment groups in the world.

Tell A Friend