Aquis Entertainment Agrees to $52M Casino Canberra Sale
Casino Canberra is all set for new ownership after Aquis Entertainment agreed to a $52 million sale to Capital Leisure & Entertainment. The sale is conditional on Aquis Entertainment shareholder approval and that of the relevant authorities. Oscars Group, a subsidiary of Capital Leisure & Entertainment, is the company tasked with running Casino Canberra once the sale completes.
Aquis Entertainment acquired Casino Canberra but is willing to let the business go. The casino’s parent company floated on the Australian Securities Exchange (ASX) in 2011 with shares costing $0.20. Those shares peaked at $0.49 in March 2021 but have traded as low as $0.01 several times.
The company’s inability to turn a profit is the main reason behind the struggling share price. Aquis Entertainment has reported an operating loss in seven of the previous eight financial years. The accumulated losses weigh in at $29,526,629 or almost $3.7 million per year on average.
- $470,628 loss in 2021
- $798,201 profit in 2020
- $3,956,569 loss in 2019
- $3,396,832 loss in 2018
- $13,811,804 loss in 2017
- $7,680,683 loss in 2016
- $616,310 loss in 2015
- $392,004 loss in 2014
Aquis Entertainment To Repay Debts With Casino Sale
The sale is slightly complicated by both the selling and buying company using subsidiaries. Aquis Canberra is the Aquis Entertainment-owned entity holding Casino Canberra shares. Capital Leisure & Entertainment owns Oscars Group, which is purchasing the casino shares.
Oscars is acquiring 100% of Aquis Canberra shares in exchange for $52 million on a debt and cash free basis. However, casino regulations in the ACT dictate Oscars must pay Aquis Canberra at least $3 million cash. Oscars confirmed all Casino Canberra employees are continuing in their employment.
Aquis Entertainment has plans for the proceeds of the $52 million sale. Aquis Canberra owes its parent company $33 million, with an August 2024 maturity date.
“As part of this review, Aquis is also considering using the proceeds from the transaction to repay some or all of the convertible loan between the company and its major shareholder Aquis Canberra Holdings Pty Ltd, and the possibility of a shareholder dividend or distribution.
Allison Gallaugher is the CEO of Aquis Entertainment and Casino Canberra. Gallaugher is keen on the sale.
“The transaction provides considerable value to the company and its shareholders. It recognises the attractive operating performance of the business, which has continued to trade well since reopening post the COVID-19 lockdowns. As an employee of Casino Canberra, I am also very excited about the future and working with Oscars on the continual improvement of our business.”
Second Time Lucky For Aquis
Aquis Entertainment attempted to sell the Casino Canberra in 2019 but the deal fell through. Blue Whale Entertainment agreed to pay $4 million cash plus $24 million of the $37 million owed to then Chairman Tony Fung. The deal would have seen Blue Whale own 87% of the casino. However, the deal fell through in December 2019 following a strong of bad luck on the casino’s part.
First, the ACT Government rejected Aquis’ grand redevelopment plans. Aquis put aside $307 million for the development, which included six-star luxury villas, a five-star hotel, and seven restaurants.
In addition, Casino Canberra applied for 500 pokies on its gaming floor. The ACT Government does not allow pokies in casinos. The government agreed for the installation of 200 pokies but with restrictions in place. Those restrictions included purchasing the machines from existing owners and not adding new machines. The casino rejected the proposal.
Hong Kong billionaire Fung bankrolls Aquis Entertainment and, therefore, Casino Canberra. Many question how long Fund is prepared to put in money hand over fist, especially because he stepped down as Chairman in in August 2021. Aquis owes Fung more than $33 million, which this sale covers and more.
