Cape Town - Peermont Global, South Africa’s third-largest casino and hotel operator, raised debt from local banks and stockholders to repay euro-denominated bonds and free up cash to expand its resorts.
The Johannesburg-based company got a 4.1 billion-rand six-year loan from banks in Africa’s second-biggest economy, as well as a 1.13 billion-rand, 6 1/2-year loan from shareholders, it said in an e-mailed statement today.
It also issued preference and ordinary stock amounting to 71 percent of its share capital to repay a further 6.2 billion rand of debt.
Peermont is seeking to cut its costs and free up cash for new projects, including a 325 million-rand casino resort at Burgersfort in the northern Limpopo province, Peermont Chief Executive Anthony Puttergill said in the statement.
“The new debt and equity package significantly lowers debt-funding costs and eliminates expensive foreign-currency hedging,” the company said.
“The new capital structure allows for much-enhanced flexibility for the group to pursue further growth opportunities.”
The Mineworkers Investment and black-empowerment trusts established by Peermont will own 25 percent of the company after the transaction, according to the statement. - Bloomberg News