Proposed Hospitality and Gaming Acquisition in Cambodia
Sydney, Nov 3, 2014 AEST (ABN Newswire) - Donaco International Limited (
ASX:DNA) (the Company) is pleased to announce that it has signed an exclusive term sheet, and is currently conducting due diligence, for a proposed material acquisition of a significant gaming and hospitality business in Cambodia.
Cambodia has a well-established gaming industry, which is supported by the Government as a driver of tourism, since local citizens are not permitted to enter casinos. The business proposed to be acquired is well-established and profitable, with good growth prospects. The market that it serves is distinct from the Company's existing China-facing business at the Aristo International Hotel. The proposed acquisition thus provides diversification as well as scale benefits.
Parts of the signed term sheet are binding, including an exclusive negotiation period extending into early 2015. This will enable the Company to complete its due diligence investigations, and to finalise and sign long-form agreements.
The acquisition will take place at a multiple of six times earnings before interest, tax, depreciation, and amortisation (6x EBITDA) for the financial year of the business ending on 31 December 2014.
The acquisition will be funded from the Company's existing cash reserves, and new debt facilities, together with an equity component for the vendor.
Based on the range of financing scenarios reviewed by the Board, the proposed acquisition is expected to provide strong earnings per share accretion for the Company's shareholders.
Further details will be provided to the market when the long form agreements are finalised.
To view the release, please visit:
http://media.abnnewswire.net/media/en/docs/ASX-DNA-826886.pdf
About Donaco International Ltd
Donaco International Limited (ASX:DNA) operates leisure, entertainment and associated technology businesses across the Asia Pacific region.
Donaco's largest business is the Star Vegas Resort & Club, a successful casino and hotel complex in Poipet, Cambodia, on the border with Thailand. Star Vegas was established in 1999, and is the largest and highest quality of the Poipet casino hotels. The property has more than 100 gaming tables, more than 1400 slot machines, and 385 hotel rooms.
Donaco's flagship business is the Aristo International Hotel, a successful boutique casino in northern Vietnam, located on the border with Yunnan Province, China. Established in 2002, the property has recently been expanded to a brand new five star resort complex with 400 hotel rooms. Donaco is a pioneer casino operator in Vietnam, and owns a 95% interest in the business, in a joint venture with the Government of Vietnam.
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