Seven years after exiting its investments in the country, Sun International is returning via the purchase of Peermont Holdings, the majority owner of the Grand Palm Hotel and Convention Centre in Gaborone.
Sun International, the South African giant which is one of Africa’s largest tourism and leisure operators, left the country in 2017 after selling its 16% stake in Gaborone Sun to Minor International, the parent group to Avani Hotels. Peermont Holdings indirectly owns 60% of Peermont Global Botswana (PGB), with the balance held by the Botswana Development Corporation (BDC). PGB owns the Grand Palm and Peermont Mondior in Gaborone as well as Peermont Metcourt Hotel & Sedibeng Casino in Francistown. The takeover is part of Sun International’s larger acquisition of Peermont Holdings in South Africa.
The larger deal is valued at ZAR7.3 billion before deductions for debt and other considerations. Under the local transaction, Sun International will also buy the BDC’s 40% stake in PGB. In a recent notice, the Competition and Consumer Authority (CCA) conditionally approved the transaction, noting that while Sun International would enjoy a dominant position in the local casino gaming market as a result of the deal, the dominance is “purely as a result of the pre-existing position of the target entity.” However, the competition watchdog noted risks around the transaction, specifically due to the buyout of the BDC, the state-owned investment agency. “The Authority is alive to the potential public interest concerns that may arise from the merger regarding the risk for merger specific retrenchments (and) the citizen shareholder exiting the shareholding structure of PGB, resulting in citizen disempowerment,” the CCA said.
Source: www.mmegi.bw
