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Rain on Grand Parade's listing

Jan 16 2008 14:47 Sikonathi Mantshantsha

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Johannesburg - Grand Parade Investments (GPI), a leisure and gaming firm, was optimistic its proposed JSE listing would proceed, possibly later this month despite speculation it may not fulfil a key term of the bourse's listing requirements.

"We will list even in these market conditions," said GPI chairperson Hassan Adams in an interview. "We will be submitting the last documents to the JSE on January 16 (Thursday) and then wait for confirmation of the listing date from them."

Doubts about the listing, however, are based on whether Sun International has retained a veto over decisions affecting SunWest Hotel and Casino, an asset in which GPI has voting control but only a 30% economic interest.

This followed a R231m deal in which GPI bought a 50% plus one share voting control of SunWest from vendor Sun International last year.

'No veto power'

Sun International CFO Rob Becker says his company does not retain veto power over SunWest, but a shareholders' agreement requires that major decisions be taken with a 60% vote in order to pass.

Although there are other shareholders in SunWest (Afrisun and a BEE Staff Trust - both controlled by Sun International) GPI still needs Sun International's support to reach the 60% mark.

The company was pencilled for flotation on the JSE before the end of December or at the latest, before the end of January 2008.

In December, Adams wrote to shareholders: "I look forward to the formal listing early in the New Year - and to the substantial increase in share value that it will bring to our loyal community of shareholders."

'Considering application'

Doug Doel, GM for issuer services at the JSE, said GPI had applied for a listing in November. "We are still considering the application," he said.

Adams said that after submitting the relevant listing documents, the JSE had undertaken to return a confirmation in ten trading days.

GPI reached an agreement with a women's group based in KwaZulu-Natal in which it bought the group's gambling interests cementing plans to become a national gaming powerhouse.

In addition, GPI shareholders could also apply for units in the company's broad-based BEE trust. They have until January 23 to accept the offer. These elements will go a long way to making for a very bullish outlook for GPI in 2008, said Adams.

The subscription of shares in the trust was progressing well, said Adams. "Fortunately we don't have to issue shares to list because our broad base of shareholders will provide tradeability," he said.

GPI was also considering whether it should issue shares in a private placement in order to raise its BEE shareholding levels above 35% so that it can exercise its full allotment of SunWest shares under the October R231m agreement with Sun International - four years before the exercise date.

GPI was granted options on over 5% of SunWest's current issued shares which would reduce Sun International's effective interest to 58,3% by June 2010. That is subject to GPI achieving a 35% BEE lock-in until June 2012.

- Fin24

 
 
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