Sun International to sell Sun Dreams stake to partner for R2.7 billion

Sun City
Sun City

Sun International has agreed to sell its majority stake in Latin American operation Sun Dreams to partner Nueva Inversiones Pacifico Sur for $160m (R2.7bn).

The parties had been embroiled in a dispute over the sale of a 14.94% stake by Sun International, which would have brought its shareholding to 50%.

Under the new agreement announced on Friday, the entirety of Sun International’s shareholding will now be sold, with the proceeds to be used to “extinguish” its Latin American debt of $38.3m, while the balance will be repatriated to South Africa.

Sun International has been grappling with the fallout from Covid-19, which has disrupted travel and shuttered casinos and hotels.

The group had debt of R13.3bn at the end of December, and announced a sweeping operational overhaul in June, including job cuts and shuttering some operations.

In morning trade on Friday, Sun International’s share price was up 7.9% to R12.15, though this is not an unusually large move for the share, whose market capitalisation was at about R3.2bn.

The group’s share has fallen by about three quarters over the past two years.

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