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SkyCity Entertainment Group will begin a formal sale process for its SkyCity Adelaide casino resort after receiving inquiries from parties it considers credible. The New Zealand-based company said the process will seek proposals from those parties and other potential buyers for its Australian asset.
The announcement was included in a Wednesday morning filing outlining the company’s strategic initiatives. SkyCity said the sale process follows its recent decision to conduct a strategic review of the Adelaide business.
The company said its wider review of the Adelaide resort, ownership structure, and asset base is focused on maximizing value for SkyCity shareholders. The formal process will allow the group to evaluate interest in the property through a structured approach.
Adelaide Review Draws Interest
SkyCity said its strategic review of the Adelaide business resulted in inquiries from credible interested parties. The company did not identify the parties or disclose how many groups had made inquiries.
The planned sale process will seek proposals from the interested parties already in contact with SkyCity. It will also allow other potential buyers to submit proposals for the casino resort.
SkyCity did not disclose a timetable for the process or indicate when a preferred buyer could be selected. The company also did not provide a value for the Adelaide property or state whether a sale agreement is expected.
The formal process is part of a broader effort to assess opportunities involving the company’s assets and ownership structure. SkyCity said it is considering these initiatives with the aim of increasing value for shareholders.
The company’s update comes after it confirmed that it would review options for the Adelaide business. The latest filing indicates that this review has moved into a formal process intended to gather and assess possible offers.
Previous Group Approaches Continue
In August, SkyCity announced that it had received unsolicited acquisition approaches from 2 parties in relation to a possible purchase of the group. The company rejected those proposals.
Despite rejecting the offers, SkyCity said it has continued discussions with both parties. It intends to maintain engagement with them while considering other opportunities that could improve shareholder value.
The board said it believes SkyCity’s current share price and the proposals previously received do not fully reflect the underlying value of the group. It said the non-binding indicative proposals received earlier in the year had not led to improved offers.
SkyCity said it will now assess a range of potential options through a structured process. The company said this will include discussions with interested parties while it continues to pursue its existing strategic initiatives.
The company did not identify the 2 parties that made the earlier approaches. It also did not indicate whether either party has expressed interest in SkyCity Adelaide specifically.
Asset Sales and Cost Program
SkyCity recently completed the sale of commercial properties in Auckland for a combined NZ$74.5 million, or US$42 million. The company also said it is in advanced and exclusive negotiations to sell The Grand Hotel.
A binding agreement for The Grand Hotel is expected shortly, according to SkyCity. The company did not disclose the expected value of that transaction.
At the same time, SkyCity is carrying out a cost-out program and a group-wide reset of its operating model. The initiative is targeting total benefits of NZ$30 million, or US$17 million, in FY27. The targeted benefits are expected to increase to NZ$70 million, or US$39.5 million, in FY28. SkyCity said these programs form part of its wider strategic work alongside the formal sale process for SkyCity Adelaide.
The company will seek proposals for the Adelaide casino resort while continuing to engage with parties that previously approached the group.
Source: Inside Asian Gaming
