The Panamanian Gaming Control Board has approved the planned merger of South African hotel and casino operator Sun International with Chilean counterpart Dreams.
Johannesburg-based Sun International already operates the Ocean Sun Casino in Panama City and has now received all of the relevant approvals for the merger, which will see it become the largest gaming company in Latin America offering an additional 7,000 slots alongside some 300 table games.
“This deal is a milestone in the history of Sun International,” Graeme Stephens, Chief Executive Officer for Sun International, told Business Day. “It gives the company great opportunities to achieve scale and reach outside Africa and diversify its earnings and risk.”
Sun International also owns the giant Sun City Casino Resort in South Africa as well as 25 other properties across Africa and The Americas and the merger will see it take a 55% stake in Dreams and its twelve casinos in Chile, Peru, Panama and Colombia.
“Dreams provides a strong presence in Chile, an expansion strategy that has seen growth in Peru, which is complementary to Sun International’s expansion into Panama and Colombia, and, importantly, an executive management team that comes from Latin America and has significant operational experience in the region,” said Stephens.
To fund the deal agreed in February of 2015, Sun International earlier restructured the debts of its Latin American operation before raising funds from Chilean banks BCI, BBVA, Santander and Itau-Corpbanca.
“Latin America holds tremendous potential and plans are well advanced to expand further in the region,” said Stephens. “We are already investigating exciting opportunities in Brazil, which is now opening to gambling, and have plans for expansion in Peru. Despite the current economic downturn, the gaming industry in Chile is still achieving good growth and there will be further opportunities in the next year or so to bid for additional licenses in Chile.”
Sun International declared that its existing Latin American business has “sufficient capacity to fund its expansion plans” while revealing that the merged entity is to be managed by Dreams’ existing executive team.
“This is a huge vote of confidence in our ability to consolidate, grow and expand further into the region,” read a statement from Sun International.