Will 2009 be the year of takeovers in the casino industry?
Sunday 4th January 2009
News that casino giant Tsogo Sun is looking to take advantage of the deteriorating economy in South Africa with a bid for a troubled casino group is seen by many as the start of things to come. The R942 million offer to acquire shares in Gold Reef Resorts, which in itself has a stake in the Queenstown Queens Casino, could prompt a similar move by other major casino groups in the region. While this offer does not appear to have any international aspirations there are many overseas groups which are struggling of late.
The likes of Las Vegas Sands, which was recently in serious financial trouble, and even Donald Trumps casino operation are literally sitting ducks for investors with substantial cash to burn and a long term investment objective. However, whether many investors would be willing to bail out at levels as low as 90% of recent share price highs is debatable but in troubled times money does talk.
There are also many unfinished ventures in the Far East as the likes of Macau experiences its first serious downturn in what until now has been a perfectly orchestrated growth phase. Who has the money and the nerve to take on such ventures remains to be seen.
News that casino giant Tsogo Sun is looking to take advantage of the deteriorating economy in South Africa with a bid for a troubled casino group is seen by many as the start of things to come. The R942 million offer to acquire shares in Gold Reef Resorts, which in itself has a stake in the Queenstown Queens Casino, could prompt a similar move by other major casino groups in the region. While this offer does not appear to have any international aspirations there are many overseas groups which are struggling of late.