Overseas shareholdings in casinos win approval

Despite Skyline Enterprises Ltd rejecting a $246 million offer from SkyCity Entertainment Group Ltd in November last year to buy significant shareholdings in Christchurch and Queenstown Casinos, a recent Overseas Investment Office (OIO) decision has granted consent.

The decision leaves the door open for SkyCity to increase its interests in the two South Island casinos - but that requires a willing vendor.

Dated March 16, the decision said the applicant - SkyCity Entertainment Group Ltd - wanted to invest in the "significant business assets", being the acquisition of direct and indirect rights and interests in a further 50% of the shares of Christchurch Casinos Ltd and a further 40% of the shares of Queenstown Casinos Ltd.

The asset value of the combined shareholding was $246 million.

SkyCity Entertainment Group Ltd is made up of New Zealand, Australia, United States, United Kingdom and various other overseas entities.

Skyline Enterprises Ltd is 100% New Zealand owned. Skyline has six directors - Grant Hensman, Phillip Hensman, Jan Hunt, Ken Matthews, Barry Thomas and Morris Walker, who are all of Queenstown.

The decision said the investment would simplify the ownership structures of the Christchurch and Queenstown casinos.

"Being part of the SkyCity group of companies will enable the full management expertise of SkyCity Entertainment Group Ltd as a casino operator to be made available to Christchurch Casinos Ltd and Queenstown Casinos Ltd."

The transaction satisfied the criteria in section 18 of the Overseas Investment Act 2005.

Last year the Otago Daily Times spoke to retired Skyline Enterprises chairman Barry Thomas who was adamant he would not sell shares in either casino.

When contacted yesterday, Mr Thomas said there had been "no sale agreement or application" and the OIO decision was "news to me".