The controlling shareholding of Bloomberry Resorts Corp Chairman and CEO Enrique Razon Jr will fall by 3.2% as a result of issuing new shares to another major shareholder.
As reported by Inside Asian Gaming, the two-part transaction will see Quasar Holdings Inc offer up to 559 million of its shares in Bloomberry to investors outside of the United States at a combined offer price of Php5.59 billion (US$98.7 million). Bloomberry will then issue to Quasar new shares in the same number and at the same price as the shares sold in the Quasar offer.
In a note, Morgan Stanley analysts observed that the share issuance would provide more cash for capital expenditure projects but would also see Razon’s stake fall from 65.5% to 62.3%.
It is expected that Bloomberry – which is scheduled to open its second Philippines integrated resort, Solaire Resort North, in Quezon City early next year – will spend Php20 billion in capex in 2H23 and between Php10 billion and Php15 billion in FY24.
In a separate note, Morgan Stanley analysts said it does not expect a planned integrated resort development in Manila by Hong Kong-listed International Entertainment Corp (IEC) to negatively impact Bloomberry.
IEC revealed last week that it plans to spend up to US$1.2 billion on the project after confirming it holds a provisional casino license courtesy of gaming regulator PAGCOR.
While the news saw Bloomberry stocks fall by 4%, the investment bank noted that the location of IEC’s development will likely be some distance from Entertainment City.
“We think the selloff [of Bloomberry shares] is a bit of an overreaction,” they wrote in reference to the decline in share price.
Bloomberry is due to report its 3Q23 earnings in November with Morgan Stanley predicting hold-adjusted EBITDA to rise by 5% quarter-on-quarter to 120$ of 3Q19 levels.
