Pretoria - Sun International has removed the biggest obstacle to its planned relocation of the Morula Sun Hotel and Casino licence to Menlyn Maine in Pretoria east by buying the opposition Peermont Group.
Peermont, which owns Emperor’s Palace, had launched a high court bid to stop the new casino.
But since the hotel and casino chain now owns Peermont, the objection to the proposed relocation would be withdrawn, Sun International spokesman Michael Farr told the Pretoria News.
Last Friday, Sun International concluded an agreement with the holders of ordinary and preferential shares as well as mezzanine debt in Peermont.
In terms of the deal, Sun International will acquire 100 percent of Peermont, which owns Emperor’s as well as Graceland in Secunda, Khoroni in Thohoyandou plus several other casinos and hotels across the country and in Botswana.
Fulfilment of the regulatory conditions precedent may take between 9 and 12 months. During that time Sun International will explore the possibility of disposing of certain of the smaller assets within the Peermont portfolio.
With regards to plans to amend its Morula Sun licence for the new R8 billion Menlyn Maine development to deliver on its potential, Sun International and Peermont reached an agreement.
In July 2014, the Gauteng Gambling Board approved Sun International’s application to amend the licence, thereby opening the door to the new R3bn casino and hotel complex which are part of the area to be known as Time Square.
Aside from the gaming hall, Sun International plans a five-star hotel and conference centre with 100 luxury rooms and 10 suites.
There will be an indoor entertainment arena seating up to 8 000 people for international and local entertainment including concerts and sports events and provide a convention and exhibition facility.
The casino will start with 2 000 slot machines and 60 tables. Depending on the demand, this can increase to 3 000 slot machines and 100 tables. Other attractions at Time Square will be a variety of shops, restaurants and bars, and there will be parking for 2 785 vehicles. The objections have caused delays, but at least six months are required to facilitate the process for design development and tendering, once all other obstacles have been dealt with.
Construction is planned in a single phase over 30 months.
Originally the development was due to be completed by June 2017.
A new date has not yet been set.
Peermont, with at least 14 residents’ organisations of Pretoria east including churches and schools, and Gold Rush Bingo – previously Viva Bingo – objected to the proposed relocation of the casino for various reasons.
While Peermont’s objection related to competition from the new casino, most of the other objections related to gambling in principle.
The residents lost their bid in the High Court in Pretoria, while the case of Peermont and Gold Rush is expected to be heard later this year.
Sun International chief executive Graeme Stephens said there was one remaining objection (referring to Gold Rush), but it seemed less likely to impede progress on the new development.
“In the event that the acquisition is not successfully implemented and Time Square at Menlyn Maine opens to the public, Peermont will receive a capital amount of R700 million, which may increase to R900 million in certain defined circumstances.
“This note has a term of five years and is without fixed terms of repayment. The note is guaranteed by Sun International,” said Stephens.
Tsogo Sun, which owns Monte Casino and Silver Star Casino, have not objected to a casino in Pretoria east.
Pretoria News