Soon a casino at the V&A Waterfront in Cape Town?

July 21, 2010

Sun International recently announced that it would challenge the Western Cape Gambling and Betting Board’s decision to allow one of the province’s existing four casinos to move into the Cape Town Metropole.

The move comes in a bid to halt the stiff competition that the group’s GrandWest Casino which is doing a thriving trade thanks to a 10 year exclusivity agreement which has recently come to an end.  According to a Sun International media release, the group has found grounds to have the decision reconsidered and will be making representations through the public process.

Co-owner’s of GrandWest through their 29.24% share in SunWest, Grand Parade Investments (GPI), also released a statement that they would challenge the decision. GPI chairman Hassen Adams commented that the group would “engage the board on this decision, but we will not fight them on every issue”.

According to the gambling and betting board, the second casino will focus on niche high roller and tourist markets and will be located in an area that is untapped by GrandWest, which the board believes should not have a significant impact on the Grand West’s revenues.  One of the possible locations for the casino is rumoured to be the V&A Waterfront.

Sun International and GPI both disagree for obvious reasons.  The initial R1bn investment that it took to create Grand West a decade ago ensured that the casino was a major attraction and the only one of its kind in the city and having a competitor on its doorstep could definitely change things for their lucrative property. So lucrative in fact that in the year to end-June 2009, it churned out R1,642bn turnover before interest, taxation, depreciation and amortisation of R675m, making the property the largest contributor within Sun International’s portfolio.

On the other side of the coin, Sun International’s rivals are likely to welcome the decision and see it as a gateway to their own ventures into the province. In fact, late last year, the Gold Reef Casino group suggested to the Western Cape’s finance MEC Alan Winde that the issue of exclusive casino licences in the Cape Town metropole be reviewed.  Gold Reef Casino group’s CEO Steven Joffe reportedly said at the time that he was eager to explore the possibility of moving the group’s Mykonos Casino which is situated in the Langebaan area closer to the city center.

To date, the gambling board has provided few details regarding the decision to end the exclusivity agreement with Sun International conclusively.  It is reported that it is yet unknown even to those in the casino sector where the second casino will be located as well as what conditions will be attached to the license.  It is certain that these factors will determine whether or not Sun International will step in to bid for the second license.

Written by admin · Filed Under Casino News, General News 
Tagged:

Comments

Comments are closed.