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Louis XIII Holdings has raised HK$2.1 billion (US$269 million) from a private share placement and an issuance of convertible bonds at HK$3 apiece to help finance the luxury casino hotel the company plans to open at Macau’s Cotai resort district in 2016.
The funds are in addition to a placement of 294 million shares and convertible notes totaling $1.6 billion completed in December, bringing to 471.27 million the number of new shares issued over the last month and representing 51.2% of the enlarged share capital of the Hong Kong-listed operator (0577).
In a statement released on 20th December, Louis XIII Chairman and CEO Stephen Hung said, “The proceeds from this placing will enable us to upgrade the design and ensure smooth delivery of our ultra-luxury hotel project.”
CLSA, the placing agent for the latest issue, exercised an upsize option to buy 177 million shares for HK$609.1 million, according to a stock exchange filing, implying a price of HK$3.44 per share. The bonds, valued at HK$755.3 million, could be converted into a maximum of 251.8 million new shares at the initial conversion price of HK$3.
As of Monday, Janus Capital Management and Deutsche Bank, respectively, hold 12.42% and 7.92% of Louis XIII, according to the filing.
Located at the far south end of the Cotai Strip, Louis XIII is designed to resemble an enclosed “diamond” and is slated to include 238 VIP-only suites, an invitation-only atelier and the only Michelin three-star L’Ambroisie outside Paris. Players are to be served by a fleet of red Rolls Royces. But the casino and its planned 66 high-roller tables have yet to receive a gaming authorization.
The company has been reported to be negotiating with concessionaire Melco Crown Entertainment for some form of sub-license.
