Property developer K Wah International has cut its stake in its Macau gaming subsidiary, K Wah Construction Materials, to below 20 per cent, by distributing shares in the subsidiary as part of its interim dividend declared yesterday.
K Wah International will distribute the K Wah Construction shares as a special interim dividend, on top of its normal interim dividend of one cent per share, on the basis of one K Wah Construction share for every 10 K Wah International shares.
After the distribution, its stake in K Wah Construction will drop by about 240 million shares to 610 million, or from 25.92 per cent in the subsidiary to 18.78 per cent.
'We still hold about 18 per cent of K Wah Construction Materials for long-term investment, and expect its share price to rise to reflect its real value,' said K Wah vice-chairman Francis Lui.
K Wah Construction shares ended unchanged yesterday at $5.40, but that represents a 79 per cent fall from its April 19 price of $9.70, when it announced a massive casino asset injection.
The acquisition of Macau-based Galaxy Entertainment Group from its chairman, Lui Che-woo, for $18.4 billion was completed in July, making K Wah Construction the only Hong Kong-listed gaming operator.
K Wah Construction will change its name to Galaxy Entertainment Group this year to reflect its new status. Galaxy Entertainment's results will be included in those of K Wah Construction in the second half of this year.