Sun International is claiming it has won 50.9% support from investors for its share offer for Real Africa Holdings (RAH). Two fund managers, Coronation and Allan Gray have agreed to recommend to their clients, around 50.9% of RAH shareholders, that they back the bid. Sun International already holds nearly 1.6% of RAH shares. The RAH board has opposed the bid, saying that the Sun International offer valued at R2.2 billion (US$326 million) was below the true worth of the company.
RAH holds 66.2% of Afrisun Leisure Investments, which in turn holds a minority interest in several Sun International casinos. There is an ongoing legal dispute between Afrisun and Sun International over the 2003 sale of shares in SunWest International. Afrisun, as a SunWest shareholder, is claiming a breach of a shareholder agreement and wants damages of R327 million (US$48.5 million).
An independent subcommittee has been appointed by the RAH Board to assess the Sun International bid. It has also appointed Standard Bank as an independent external advisor on the offer. When it has been given the independent evaluation, RAH will go back to their shareholders with a recommendation based on the offer price assessment. The Sun International bid is widely thought to be reasonable although not generous. (E-06.12.06)
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