Grand Parade in R170m buyout
Purchase of Carentan to transform gaming investor into operating firm
November 3, 2009
By Donwald Pressly
Grand Parade Investments (GPI) has announced its intention to purchase Carentan Investments - the majority shareholder in Thuo Gaming, wholly owned by Australian-based Tatts Group.
The move will transform the black-empowered firm from an investment to an operating company.
The R170 million deal will parachute GPI into operating 2 000 limited payout machines (LPMs) in South Africa - 1 000 in KwaZulu-Natal and 1 000 in the Western Cape.
GPI chairman Hassen Adams said the deal was about maintaining GPI's growth trajectory with increased control.
"I am hugely excited by this opportunity as the domain of gaming operators has always been an exclusive club," he said. "GPI has always been an investment company.
"We now automatically become an operating company; that makes us a lot more able to look at opportunities that we can manage on our own."
It represents the first time that a black empowerment company will go into the operational side of the gaming business in South Africa.
Adams said: "We can now drive our own destiny in the gaming sector."
He believed the deal would enable the business to grow in southern Africa. GPI was looking to Mauritius and Namibia for expansion.
Adams said GPI would introduce its own people into management, "mentoring them into all facets of the industry".
Noting that GPI had been talking to the Tatts Group for about three years, Adams said Tatts had previously had an interest in Uthingo, which lost its licence to run the national lottery. This may have contributed to the company's decision to sell to GPI.
Adrian Funkey, GPI's chief executive, said yesterday: "With our management team, we are confident that we can drive this new operating component of our business successfully."
GPI, which was launched in 1997 and listed in 2008, is a broad-based black empowerment enterprise that draws its shareholder base from black communities in the Western Cape. Through SunWest, it has interests in the GrandWest Casino and Entertainment World in Goodwood, and the Table Bay Hotel at the Victoria & Alfred Waterfront.
GPI shares closed unchanged at R2.63.
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