GGRAsia – Taiwan firm eyes Europe slot market via Palasino stake

Taiwan firm eyes Europe slot market via Palasino stake

Mar 26, 2024 Newsdesk Latest News, Rest of Asia, Top of the deck, World

Taiwan’s Xiang Shang Games Co Ltd, trading as XSGames, is a “cornerstone investor” in the initial public offering (IPO) in Hong Kong of Palasino Holdings Ltd, a firm with interests in European casino venues and hotels, the latter said in a Monday night filing.

XSGames, an online gaming content and supplier of land-based slot machines, has subscribed to 18.8 percent, or just over 26.92 million, of Palasino’s IPO shares, Palasino Holdings stated. The percentage was calculated on the basis that an over-allotment option was not exercised.

XSGames said in its own press release, it considered its new investment – representing a 3.4-percent holding in Palasino Holdings – as a springboard to becoming the “first Taiwanese company to introduce slot machine products into Europe”.

In its first day of trading on the Hong Kong bourse on Tuesday, the listed Palasino Holdings entity saw its shares rise circa 24 percent from its offer price of HKD2.60 (US$0.332) in early business, before falling back to a 6.5-percent gain by lunchtime.

Palasino Holdings is a spinoff from Hong Kong-listed Far East Consortium International, which is itself an investor in the Queen’s Wharf Brisbane scheme including a casino resort, in Brisbane, Queensland, Australia, promoted by the Star Entertainment Group Ltd.

The Palasino entity’s post-IPO majority shareholder, with 73.21 percent – assuming an over-allotment option is not exercised – is Ample Bonus, a wholly-owned subsidiary of Far East Consortium.

Palasino Holdings said the IPO raised gross proceeds of HKD222.9 million, which was less than a figure previously mentioned. After HKD28.8 million in expenses, the Palasino entity netted HKD194.1 million. XSGames stake is worth circa HKD70 million.

Palasino Holdings offered nearly 142.86 million shares globally, comprising 85.71 million new shares and 57.14 million existing shares. The number of shares in Hong Kong’s public offering accounted for 30 percent of the exercise, according to Monday’s filing.

Palasino Holdings runs three land-based casinos in the Czech Republic, one of them within an integrated resort. The venues’ players are mostly from neighbouring Austria and Germany, according to corporate information. The company also operates three hotels in Germany, and one hotel in Austria.

Palasino Holdings additionally has a licence issued by the Malta Gaming Authority that allows the company to run online gaming business in that jurisdiction,

In its prospectus, the company had said the bulk of the IPO’s net proceeds would be used to: “maintain and further consolidate Palasino’s market presence in the gaming industry in the Czech Republic through asset rejuvenation”; and “expand the firm’s gaming business in the Czech Republic, Central Europe or other markets through acquisition of business or asset and/or bidding for new gaming licences”; with some funds “for additional working capital”.

XSGames’ European goals

XSGames said in a Monday press release that its investment in Palasino Holdings was “primarily driven by Palasino ‘s strengths in the European gaming industry”.

The Taichung, Taiwan-based firm added: “With over 20 years of operating physical casinos and hotels in Europe, Palasino has obtained a licence for online gaming operations in Malta.”

The Taiwan technology supplier stated: “In the future, Palasino will leverage XSGames’s experience in global gaming platform operation and technology to enhance business expansion for both companies.”

XSGames said it was “committed to providing trusted technology and products for the global gaming industry”.

It further outlined: “With 15 years of deep involvement in the global gaming industry, XSGames has been offering diverse products and services to partners and clients worldwide, including online gaming platforms, LAN [local area network]-based gaming systems, and slot machines.

With operations in Taiwan, the United States, Australia, and China, XSGames said its slot machines “successfully entered the U.S. market in 2022”.

XSGames added: “Palasino plans to procure slot machines from XSGames to enrich its product diversity. In the future, XSGames will plan to launch its products into the European market through this collaboration.

“This successful entry into the European market will mark the first Taiwanese company to introduce slot machine products into Europe, representing a significant milestone for XSGames and a new chapter for Taiwan’s gaming industry development.”