Resorts to sell entire GIL stake

It is making an offer of one GIL stock for 10 Resorts shares

PETALING JAYA: Resorts World Bhd has proposed to sell its entire 6.16% stake in Singapore-listed Genting International plc (GIL) to its own shareholders.

The company told Bursa Malaysia yesterday that the price and entitlement period for the non-renounceable offer of one GIL share for every 10 Resorts World shares would be announced at a later date.

Resorts World said it “intends to fix the offer price at the ringgit equivalent of Resorts World's average cost of investment” in GIL.

At Dec 14, Resorts World owned 593.72 million shares in GIL valued at about US$158.8mil.
Assuming it sells the shares at 89 sen each, or 38.8 Singapore cents, the exercise would net total proceeds of RM527mil for Resorts World.

Based on GIL's closing price of 69.1 Singapore cents on Dec 14, the offer would translate to a discount of nearly 44% against the stock's market price.

The share sale exercise is targeted for completion by the end of the first quarter 2008.

Resorts World said proceeds from the divestment would be used for working capital and investment, including mergers and acquisitions. The exercise will give Resorts World investors direct exposure to GIL.

In 2006, the GIL group acquired Britain's largest casino operator Stanley Leisure plc and de-listed the company from the London Stock Exchange (LSE) in November the same year.

GIL also assumed 100% equity and full control of the integrated resort on Sentosa Island, a project awarded by the Singapore government late last year.

As of Dec 13, the company also had a 10% stake in LSE-listed Rank Group plc, Britain's second largest bingo operator and second largest casino operator, which also has online gaming businesses.

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