Friday 29 Mar 2024
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KUALA LUMPUR (Aug 7): Shares in Genting Malaysia Bhd (GenM) fell 8.03% this morning after the firm acquired 46% of the common stock in Nasdaq-listed gaming and entertainment company, Empire Resorts Inc, from Tan Sri Lim Kok Thay, via Kien Huat Realty III Ltd.

At 9.32am, GenM fell 29 sen to RM3.32 for a market capitalisation of RM19.71 billion.

It was reported yesterday that the related party transaction is priced at US$9.74 per share of the common stock, some 13.2 million in all, which represent about 35% of the outstanding voting power of Empire on a fully diluted basis, after conversion of all outstanding preferred stocks into common stocks.

Kien Huat currently controls 84% stake in Empire, which has been loss making for the past two decades, according to Bloomberg. Empire posted a net loss of US$155.36 million for the financial year ended Dec 31, 2018 — the biggest ever loss.

Following the proposed share acquisition, GenM and Kien Huat will join hands to take Empire private at the same consideration of US$9.74 per share of common stock.

GenM, in a stock exchange filing today, said it has inked a binding term sheet with Kien Huat for its wholly-owned Genting (USA) Ltd to undertake the acquisition, which GenM said will be funded by internal funds. As at March 31, 2019, GenM's cash and cash equivalents stood at RM7.92 billion, while its debts was at RM9.68 billion.

Empire owns and operates Resorts World Catskills (RWC), a casino resort situated on a 1,700-acre site in New York.

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