Century Casinos Agrees to Sell Interest in Gauteng, South Africa,
Project
COLORADO
SPRINGS, Colo
- Century Casinos, Inc. announced today that it has agreed to sell
its interest in the Gauteng, South Africa, license application.
In 1997, Silverstar
Development Limited (Silverstar), along with Century Casinos, Inc.
(Century), had made an application to the Gauteng Gambling Board
(GGB) for a casino license in Gauteng, South Africa. After a series
of legal challenges and lawsuits, the license is still unresolved
with the GGB having seen fit to prolong the legal dispute through
the Supreme Court, resulting in Silverstar not being able to commence
with the casino development. Silverstar has immediate pressing financial
needs beyond the level which they or Century would consider supporting,
considering the legal uncertainties unresolved and bearing in mind
the long history of the project.
The Akani Group
which is comprised of Akani Leisure Investments (Proprietary) Limited
and Gold Reef Casino Resorts Limited (partly owned by the Casinos
Austria group) has agreed to provide the funds necessary for Silverstar
to complete the project and to acquire the entire shareholding of
Silverstar as well as all assets, rights and obligations of Century
in the project.
The total selling
price to Century is R50,3 million, approximately $8.5 million. An
initial payment of R10.0 million, approximately $1.7 million, has
been received today for the sale of land owned by the Company's
South African subsidiary for the casino site and reimbursement of
expenses and previously advanced funds to Silverstar.
The balance
of R40.3 million, approximately $6.8 million, is contingent on certain
approvals being secured by Silverstar and the Akani Group. The outcome
of these approvals is unknown at this time but with the financial
backing of the Akani Group, funding is now available to Silverstar
to complete its tasks and provide a higher level of assurance that
Century will ultimately get a return on its efforts to date. Should
such approvals not be obtained, Century's involvement in the project
will be restored to the previous level of ownership and management.
"The legal
process in which Silverstar is embroiled in was demanding an increasing
amount of management's time. The financial and management distraction
for the Gauteng project had to be considered in light of the various
exciting North American opportunities that have been secured. We
believe the later represent a better use of Century's resources
and look forward to completing this transaction to further grow
Century Casinos, Inc.", said Chairman and CEO Erwin Haitzmann
|