Thursday, March 27, 2014

Reef bidders and targets statements

The bidders and targets statements for the takeover by Aquis have been posted this week and are available for download at Reef Casino Trust. Most interest is probably in the independent experts report within the target statement which has determined the offer fair and reasonable and I will peruse in due course.

Perhaps the first thing any holders should note however is "when will I be paid?" Effectively this wont be until up to a month after all the conditions have been waived or fulfilled. It has been indicated the process and conditions which includes probity and approval for transfer of the Casino licence may take some months so immediate acceptance wont necessarily bring any cash in a hurry. There may also be aspects around the timing of the next distribution to clarify?

Information in the bidders statement doesn't really provide any greater illumination on the Fungs. There is a detailed list of the family investments in Queensland but only a vague reference to "two major Chinese property development projects".

Fung is described as having been a private investor since the exit in 1996 from Sun Hung Kai which had been founded by his father in 1969. This doesn't appear to be strictly correct from my research with no mention of his subsequent interest in Yu Ming which some media reports have claimed as the source of his billionaireness.

There have also been changes in the corporate structure. The offer for Reef Casino Trust is from Aquis Casino Acquisitions Pty Ltd. At the time the offer was announced this was held wholly owned by Tony Fung in his own name with an address in Hong Kong. This has now been shifted earlier this month to within the holding structure ultimately held in the British Virgin Islands.

 
Sources of Consideration (section 4) also provides further detail on the structure and source of funds:
 


That may comply with the probity standards of the current Queensland administration but doubt it would satisfy my own standards as appropriate for a casino licence. Aquis at the Great Barrier Reef Resort Pty Ltd currently continues to remain outside that structure and held directly by Tony Fung

Disclaimer: I hold 5,000 RCT units through a super fund.

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