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Cape Town - Cape Empowerment Trust (CET) surprised the market on Thursday with the sale of 11.8m shares in gaming group Grand Parade Investments (GPI,) worth about R25.6m.
Last year, a debt-laden CET advised shareholders it was considering the sale of its stake of roughly 11% in GPI. But the group subsequently called off the deal when directors opted to sell off its property interests (held mainly in JSE-listed Ambit).
Despite the sale, CET still retains a significant minority stake in GPI worth about R65m to R70m. Whether CET would contemplate further sales of GPI shares is not clear at this stage.
But the deal will puzzle punters who believed a de-geared CET would perhaps look at increasing its stake in GPI, which not only owns valuable gaming assets but has also paid generous dividends for the past few years.
GPI holds stakes in a number of Sun International casinos, most notably GrandWest in Cape Town and the Golden Valley casino in Worcester.
GPI also owns about 30% of gaming investment company Real Africa Holdings and a major stake in Thuo Gaming, the limited payout machine operator.
It appears there was no single buyer for the 11.8m GPI shares, with CET advising the shares had been sold in the open market.
CET directors said the disposal was intended to rebalance the group's investment portfolio, which presently comprises gaming, security, financial services and property.
They said CET would use proceeds from the GPI share sale to reduce debt as well as pursue other "attractive new opportunities and to make further investments in certain existing investments", with special focus on property and services.
In March CET advised that it had merged its security subsidiary, Alexandra Security, with another security services company.
CET also owns a major stake in JSE-listed security services company Command Holdings, which - as has been speculated on Fin24.com previously - could eventually house all CET's services interests.
- Fin24.com
