Hong Kong tycoon offers to buy casino in Cairns
Tony Fung Wing-cheung has offered to pay A$214 million (HK$1.54 billion) to buy Reef Casino Trust, which owns the only casino in the city of Cairns near the Great Barrier Reef, in a bid to enter Australia's gaming and tourism market.
Shares in Reef Casino surged 44.4 per cent to six-year highs after yesterday's announcement.
Fung, a billionaire son of one of the founders of Hong Kong conglomerate Sun Hung Kai & Co, has previously proposed a A$4.2 billion casino and resort project in Cairns, which has yet to be approved by the government.
Reef Casino was in discussions with Aquis Casino Acquisitions, controlled by Fung, after receiving a non-binding proposal to buy all the units at A$4.354 per unit, the trust company said in a statement.
The offer was priced at a 53 per cent premium to Reef Casino's closing price on Tuesday.
The stock yesterday closed 40.5 per cent higher at A$3.99 after a hitting peak of A$4.10.
One condition of the proposal is that Aquis also buys Casino Canberra, which is associated with Reef Casino.
The biggest holders of the trust - Casinos Austria and France's Accor Group - had indicated that they would support the proposal unless there was a superior one, the trust added.
Aquis had started meeting with the Queensland and Australian Capital Territory governments regarding regulatory processes, the statement said.
Australia's 13 casinos currently capture just 1 per cent of the US$34 billion market for high-roller gamblers in Asia annually, but state governments are approving multibillion-dollar developments to boost that figure.
Echo Entertainment Group and Crown Resorts, controlled by James Packer, are moving north as they battle for supremacy in the market. Echo unveiled plans to invest A$1.5 billion in its Queensland casinos last Friday.