Malaysian gaming firm sells shares in Singapore unit
Posted by Gavin Smith on 28 May 2009 at 10:05
The owners of Malaysian gaming company Genting Bhd have sold around nine per cent of shares in its Singapore unit to raise $425 million, according to reports.
The news agency Reuters said 853.8 million Genting Singapore shares went for S$0.72 per share, equating to a discount of about 17 per cent on its last closing price.
According to the news agency, unnamed sources said the sale was designed to boost the stock's liquidity.
As a result shares of the unit went down by more than a fifth, prompting a query from the Singapore exchange on the sharp price changes.
Shares in Genting Bhd slid 4.5 per cent in Malaysia. The firm is run by the family of Lim Kok Thay, who is chairman and chief executive.
The Genting Singapore shares were sold at the lower end of a S$0.72-S$0.76 per share range listed in a term sheet Reuters said it had seen.
The agency added there had been no comment from representatives of Genting in Singapore and Malaysia, adding its sources did not want to be named as the deal is not public.
Analysts have said Genting has been known to be looking for investment opportunities in Las Vegas and Macau.
The recent stake sale seems to be designed to take advantage of a considerable rise in the company's share price.
Keith Wee, quoted by Reuters, said: "It does make logical sense for the Lim family to lock in some form of capital gains from their own direct stake,"
In Malaysia, Genting shares have increased by 7.6 per cent since May 20 after it said it and unit Resorts World "subscribed for a combined $100 million worth of notes issued by MGM" as part of its "$1.5 billion fund-raising exercise" Reuters added.
Liong Chee How, analyst at Kenanga Investment Bank, was also quoted by the agency as saying: "They've always said they want to enter Macau and Las Vegas. There's always the possibility that these are somehow connected, but I would imagine if there are investment opportunities, it would be done via Resorts World,"
"They have a very strong, very clean balance sheet. There is no reason not to take advantage of that,"
