Minor International and Sun International Announce Strategic Partnership
For Eight Hotels in Botswana, Lesotho, Namibia, Swaziland and Zambia
Minor International Pcl ("MINT") and Sun International Limited ("Sun International") announced today that terms have been agreed whereby: (i) Sun International is disposing a significant portion of its shareholdings and interest in its Botswana, Lesotho, Namibia, Swaziland and Zambia operations, consisting of eight properties ("African Assets") to MINT for a total consideration of R679.5 million (USD 63.9 million), and (ii) Sun International and MINT are forming a new strategic partnership to own and operate the African Assets going forward ("Partnership"). The Partnership intends to leverage both companies' core strengths where Sun International will continue to manage the casino operations, while MINT will assume the hotel management, marketing and distribution under MINT's Anantara and AVANI brands.
The proposed transaction and the partnership with MINT in Africa are in line with Sun International's strategy to optimize its capital allocation and resources. The Partnership enables Sun International to remain invested in the African Assets but with responsibility for the casino component only, as well as to partner with MINT in other African opportunities that have a casino element. Going forward Sun International will be able to give greater focus to opportunities identified in Latin America and Asia (where MINT has a strong presence) as further key growth markets for its core casino business. In addition, MINT will commit its pro rata share of new capital expenditure to realize the revenue potential of the African Assets, thus giving Sun International more room to consider capital investment opportunities elsewhere. Sun International will use proceeds from the disposal to reduce its debt and provide capacity for its strategic expansion initiatives.
The proposed transaction allows MINT to invest and operate in Botswana, Lesotho, Namibia, Swaziland and Zambia, where MINT believes in secular demand growth for quality accommodation. In addition, MINT will bring its hospitality expertise, together with operational and distribution capabilities, to capture the growth potential of the African Assets. The proposed transaction also fits with MINT's expansion plans in Africa, where MINT currently owns eight luxury game lodges and resorts in Kenya and Tanzania under the Elewana Collection, and five hotel projects in Mozambique under MINT's Anantara and AVANI brands.
Sun International Chief Executive Graeme Stephens remarked that "the Proposed Transaction provides an opportunity for Sun International to create a strategic alliance with MINT, a leading hospitality and leisure operator that brings not only hotel management and marketing expertise but also an ability and desire to invest in the assets under its management. With MINT now taking the bulk of management responsibility for the African Assets, the proposed transaction allows Sun International and its management team to increase their focus on the core casino assets that are driving its financial performance and strategy. In addition, Sun International will remain invested in the Partnership and will continue to benefit in the future growth of these African Assets under the new alliance with MINT."
William E Heinecke, Chairman and Group CEO of MINT commented "Over the past few years, MINT has strategically expanded its hospitality business into many regions, and Africa is one of the continents that MINT saw substantial growth potential and has put its focus on, as evidenced by a number of acquisitions and partnerships in the region. MINT is excited by this latest acquisition which will augment its growth strategy in Africa and will further introduce our Anantara and AVANI brands in the region. We look forward to seeing our partnership with Sun International further flourish in the future".
Dillip Rajakarier Chief Executive Officer of the Minor Hotel Group added "Starting with the existing African Assets, it is the intention of the Partnership to explore together other hotel and gaming opportunities that may arise in Africa and Asia, where MINT would manage the hotel component and Sun International would manage the casino component".
The only African property outside of South Africa owned by Sun International and not part of the Proposed Transaction is the Federal Palace in Lagos, Nigeria, in which Sun International and MINT are in discussion regarding a possible investment by MINT.
The transaction requires, inter alia, the finalisation of certain transaction documents and obtaining of regulatory approvals in the various jurisdictions in which the African Assets are located. The sale and purchase agreements for each of the African Assets are inter-conditional as the African Assets are being sold as a portfolio.
About Sun International:
Sun International is a leading hotel, resort and gaming company focused on the development, management and operation of hotels, resorts and casinos in South Africa, other parts of Africa and Latin America. Sun International is listed on the JSE Limited and is invested in and manages a portfolio of hotel and casino properties valued at $2.3 billion.
The Sun International Group has a diverse portfolio of assets including modern and well located casinos, some of the world's premier resorts and world class five star hotels, including iconic properties such as The Royal Livingstone Hotel at Victoria Falls, The Palace of the Lost City at Sun City (Sun International's flagship integrated resort) and The Table Bay Hotel in Cape Town.
Sun International has leveraged off its strong presence in Africa to expand internationally. The Group successfully extended operations into Latin America with initial operations in Chile and new casino operations to be opened shortly in Panama. The Group is actively pursuing further expansion opportunities within Latin America and Asia.
About Minor International
Minor International (MINT) is a global company focused on three core businesses: restaurants, hospitality and lifestyle brands distribution. MINT is one of Asia"s largest restaurant companies with over 2,000 outlets operating system-wide in 19 countries under The Pizza Company, Swensen"s, Sizzler, Dairy Queen, Burger King, Thai Express, The Coffee Club, BreadTalk (Thailand) and Riverside brands. MINT is also a hotel owner, operator and investor with a portfolio of 155 hotels and serviced suites under the Anantara, AVANI, Oaks, PER AQUUM, Tivoli, Elewana Collection, JW Marriott, Four Seasons, St. Regis, Radisson Blu and Minor International brands in 24 countries across Asia Pacific, the Middle East, Africa, the Indian Ocean, Europe and South America. MINT is one of Thailand"s largest distributors of lifestyle brands focusing primarily on fashion, home and kitchenware and contract manufacturing. Its brands include Gap, Banana Republic, Brooks Brothers, Esprit, Bossini, Etam, Charles & Keith, Pedro, Radley, Anello, Zwilling J.A. Henckels, Joseph Joseph and ETL Learning. Bemynt is MINT"s e-commerce platform offering premium fashion and lifestyle products. For more information, please visit www.minorinternational.com.