Sun eyes casino prospects in Brazilian market

2 Jun 2016

Gaming and leisure giant Sun International looks set to place a bet in the Brazilian casino market, and is also watching developments in Mexico closely.

Image credit: Reuters

Speaking on Wednesday after the finalisation of the merger of Sun International’s Latin American casino interests into gaming group Dreams, CEO Graeme Stephens said the company had for a number of years been looking to position itself in the Brazilian market — which is now open to gambling.

But Stephens cautioned that Dreams, in which Sun International holds a 55% stake, would be bidding for casino licences in that country against some of the biggest casino operators in the world.

"We can’t promise we’ll secure the biggest, best and most obvious casino sites in Brazil. But, we certainly have our finger on the pulse in that country," he said.

Stephens said Mexico was on Dreams’ longer-term radar.

"It’s mostly an informal gaming market. We have our eye on it, and if things change, we will act. It’s a good economy, and we believe an opportunity will come in time."

The Dreams portfolio boasts six casinos in Chile (Iquique, Temuco, Valdivia, Puerto Varas, Coyhaique, and Punta Arenas) and four in Peru (all in the capital city, Lima).

Sun’s portfolio comprises Monticello Casino in Chile, Ocean Club Casino in Panama and Sun Nao Casino in Colombia.

Stephens reckoned the size and scale of new-look Dreams — now the largest casino operator in Latin America — would give it the profile, critical mass, and balance sheet to expand to the rest of the continent, make meaningful acquisitions, and take on larger projects.

Stephens stressed, though, that Sun International would, for now, focus on its South African operations and Latin America, rather than seeking other opportunities globally.

"We do have irons in various fires across the world. If one turns red hot, we will act. But for now, we have enough on our plate in SA and Latin America."

Asked whether Sun International could increase its stake in Dreams, Stephens said the company held pre-emptive rights over another 20% stake held by a private equity firm.

Source: Business Day

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