Genting Malaysia has officially initiated its bid to acquire full control of US-based gaming company Empire Resorts after its wholly-owned subsidiary, Genting (USA) Ltd (GenUSA), purchased 13.2 million Empire shares from Kien Huat Realty III Ltd, the family trust of Genting Chairman Lim Kok Thay.
The US$128.6 million purchase was originally touted in early August as the first step in a complicated takeover plan that will see GenUSA Ltd and Kien Huat now look to jointly acquire by merger all remaining shares in Empire – which operates New York’s Resorts World Catskills – and form a new entity 51% owned by Kien Huat and 49% by Genting (USA) Ltd.
In a filing with the Malaysian Bourse on Tuesday, Genting Malaysia said that GenUSA now holds a 38.3% equity stake in Empire on an undiluted basis and 33.3% on a fully diluted basis, assuming full conversion of all preferred stock currently outstanding into Empire’s Common Stock.
Kien Huat had previously held 86% of Empire’s issued share capital.
“The obligation of GenUSA and KH to consummate the Proposed Acquisition is independent of, and not conditional upon, the Proposed Merger,” it added.
The purchase of shares comes despite a lawsuit having been launched by a minority shareholder of Empire Resorts against Empire, Genting Malaysia and Kien Huat claiming they are steering the company towards privatization against the interests of other shareholders.
Genting Malaysia has previously described the takeover bid as an opportunity to better position the Resorts World brand in the region through cross-marketing with Resorts World Casino New York City, reduce costs and utilize its own IR experience to help improve the performance of Resorts World Catskills.
RelatedPosts
