SI-Peermont deal in trouble

A YEAR after Sun International
announced its intention to buy
Peermont for R9,4bn, it seems the
deal will fall through. The proposed
transaction would have boosted Sun
International’s existing portfolio through
diversification and paved the way for
growth.
Michael Farr, Sun International’s
gm of corporate brand and
communications, said with timing tight
to meet the requirements required by
the Competition Tribunal for approval,
it had become “impossible for the
condition precedent to be met by March
31” and that “as a consequence, it
is anticipated that the transaction will
terminate and we are in the process of
negotiating to cash settle the Menlyn
Maine note for R675m on 30 April
2016 in settlement of all claims”.
Sun International applied to the
Gauteng Gambling Board in 2014 to
relocate its Morula casino licence from
Mabopane to Menlyn in Pretoria, an
arrangement that Peermont initially
objected to but withdrew in light of
the upcoming buyout. Permission
was granted for the relocation, which
forms part of the R3bn Time Square
at Menlyn Maine development due to
open in the City of Tshwane in 2017.
A proviso to this was that if the deal
between the two gaming and hotel
groups fell through, Sun International
would pay Peermont a capital amount
in compensation. Negotiations to
settle this are progressing between the
parties.
Grant Robinson, Peermont’s financial
director, said the company had
continued its focus on its operations
throughout the process and, with the
transaction likely to fail, remained
confident that ongoing prioritisation
of operations performance and client
service would continue to deliver
results.