Summit Ascent key investor eyes US$55mln stake sale
The largest-single shareholder in Hong Kong-listed Summit Ascent Holdings Ltd, the promoter of Russian casino resort Tigre de Cristal, is mulling disposing of its stake to an undisclosed suitor.
The key investor, conglomerate First Steamship Co Ltd, confirmed in a Monday filing to the Taiwan Stock Exchange that – as reported by Summit Ascent earlier this month – First Steamship had been approached “by a third party” regarding the matter. First Steamship said the suitor “could be” an “existing shareholder or strategic investor”.
In the Monday filing, the Taiwan group said were it to achieve its asking price of HKD1.50 (US$0.191) per share it would realise at least HKD429 million (US$54.7 million) from the deal, representing a gain of approximately HKD123 million – excluding taxes and other relevant handling expenses – on its original investment.
First Steamship confirmed in its Monday regulatory announcement it owned 286,048,000 shares – or approximately 19.22 percent – of Summit Ascent.
The Taiwanese firm told its local bourse “no final decision” has been made regarding the possible disposal, but said its board had nominated chairman Jerry Kuo Jen Hao to lead the negotiations.
Mr Kuo is also the chairman and a non-executive director of Summit Ascent and has been since December 2017, when First Steamship initially acquired a 12.67 percent holding in the casino promoter. The investment was via First Steamship’s subsidiary Heritage Riches Ltd. First Steamship upped its stake in Summit Ascent in October 2018, taking its interest to the current circa-286 million shares.
First Steamship was announced as an investor in Summit Ascent on the same day the latter reported that Asian casino entrepreneur Lawrence Ho Yau Lung planned to sell 20 million shares in Summit Ascent, thereby ending his role as a direct shareholder in the firm.
Lee Shih Ming, a spokesman for First Steamship as well as its chief financial officer, confirmed to Taiwanese media in a Monday briefing his company’s desired price for disposing of its stake in Summit Ascent.
Mr Lee indicated his firm might not have an appetite for long-term investment in Summit Ascent. He said that despite positive mid- to long-term prospects for the Tigre de Cristal property, Summit Ascent might not be distributing a dividend soon as it was planning to invest heavily in the second-phase construction of the resort.
The Taiwan-listed firm currently operates shipping as well as department stores in several second-tier and third-tier mainland Chinese cities under the brand “Grand Ocean”.
Summit Ascent reported last month a profit of HKD7.6 million for full calendar year 2018, compared to a profit of approximately HKD13.8 million a year earlier. In its March results Summit Ascent said it would be revising soon the designs and financing for the second phase of Tigre de Cristal, and aimed to have it open in the summer of 2021.
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