Casino news source: The Australian Business - http://www.theaustralian.news.com.au
Bonderman said to be the mystery bidder for Skycity
Katherine Jimenez | September 29, 2007
PRIVATE equity heavyweight David Bonderman is rumoured to be behind the $2.5 billion bid for trans-Tasman casino operator Skycity Entertainment.
Speculation surfaced overnight that the US billionaire's Texas Pacific Group, joint owner with the Myer family of department store chain Myer, is behind the approach to the Skycity board.
Skycity -- owner of the Adelaide and Darwin casinos in Australia -- yesterday issued its second statement in less than a week advising it had "agreed to allow the interested party to undertake commercial and financial due diligence" on the company, which might potentially result in a firm takeover proposal.
But the board also said it would consider approaches from other parties interested in control or a merger and planned to "actively approach" other parties to assess their potential interest in the company.
The Dominion Post in Wellington reported yesterday that the mystery bidder was believed to be TPG Newbridge and that former Skycity boss Evan Davies could also be part of the bid.
"Harrah's held a management contract for Skycity's Auckland Casino in the mid-1990s before the Kiwi company, under Mr Davies' leadership, bought it out in 1998," the paper said.
However, other sources downplayed the likelihood TPG was circling Skycity.
Skycity shares surged 15c to $4.48.
Skycity first flagged the "confidential approach" last week, advising that the buyer was interested in acquiring 100 per cent of the shares in the company and that its cash offer would represent a "significant premium" to Skycity's current price. At the time, Skycity shares were hovering at about $3.70.
One market source said the board's decision to actively seek interested parties was likely to flush out interest from "a wide number of private equity firms".
He said $5.50 was a "fair" base level but the "magic number" would be $6, which would value Skycity at $2.7 billion.
TPG, in partnership with private equity firm Apollo Management, last year reportedly paid a 35 per cent premium to acquire the world's largest casino operator, Harrah's Entertainment.
In its statement, Skycity said the interested party "insisted" that its identity remain confidential, but made a point of saying that the board "considers the interested party to be credible and its approach to Skycity to be genuine".
In other gaming news, the latest Tabcorp annual report showed that former chief Matthew Slatter received a termination payment of $3.3 million. He also collected a remuneration package worth $1.72 million.
Newly installed chief Elmer Funke Kupper earned total remuneration of $2.2 million.
That was made up of a salary of $1.26 million and performance options and share rights worth $158,109.
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