Belle Corp, an investor at the City of Dreams Manila casino resort in the Philippines, is to raise approximately PHP1 billion (US$21.9 million) by selling its remaining 47.85 million shares in Pacific Online Systems Corp to a Belle subsidiary.
In a filing on Wednesday to the Philippine Stock Exchange, Belle said it plans to use the sale proceeds “mostly for debt repayment”.
According to Financial Times market data, Belle Corp had total debt of just under PHP4.8 billion in financial year 2014, and a debt to total capital ratio of 15.30 percent in that period.
Net profit at Belle Corp fell by nearly half year-on-year in the six months to June 30. The management said that the main reason for the year-on-year change was non-recurring items in the first half of the 2014 reporting period, relating to its subsidiary Premium Leisure Corp. The latter has an operating agreement that grants it a share of gaming revenues or earnings at City of Dreams Manila. The casino venue is managed by a unit of Melco Crown Entertainment Ltd.
The core business of Pacific Online Systems – according to a website of that company – is to provide operating and management systems for the Philippine gaming industry, including “technical and market expertise” for the distribution of lottery products in the country in partnership with the state-run Philippine Charity Sweepstakes Office (PCSO).
Belle plans to sell its stake in Pacific Online Systems for PHP20.90 per share, to Premium Leisure, which is a consolidated subsidiary of Belle. The latter firm owns 78.7 percent of Premium Leisure’s total outstanding shares.
The transaction will increase Premium Leisure’s total holdings in Pacific Online Systems to 149.5 million shares, or equivalent to 50.1 percent of Pacific Online Systems’ 298.4 million outstanding shares, said Wednesday’s filing.
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