Melco Resorts & Entertainment Acquires 75% Equity Interest in Cyprus Casino Resort
Developer and operator of casino resorts Melco Resorts & Entertainment today announced that it has entered into an agreement with its parent company Melco International Development to acquire the latter’s entire holding of ordinary shares in the owner of the City of Dreams Mediterranean integrated resort.
The deal will see Melco Resorts & Entertainment assume ownership of a 75% equity interest in ICR Cyprus Holdings, the owner of casinos around the Republic of Cyprus, including City of Dreams Mediterranean, which is currently under development in the Cypriot City of Limassol.
Under the terms of the deal, Melco Resorts & Entertainment will acquire the acquisition shares in exchange for 55.5 million ordinary shares of Melco, equivalent to approximately 18.5 million American depositary shares of the company and representing approximately $375 million in transaction consideration to be issued at the closing of the acquisition deal.
The transaction is subject to regulatory approval from the competent Cypriot authorities, customary closing conditions, and the execution of a new shareholders agreement by Melco Resorts & Entertainment.
The new shareholders agreement will require Melco to “provide certain corporate-level management services to the ICR Group for a fixed amount of EUR2 million per annum.” The deal is expected to be finalized no later than September 20, 2019.
Progress of Melco’s Expansion in Cyprus
Melco has been operating integrated resorts in Macau and the Philippines. The recently agreed deal will enable the company to extend its footprint outside Asia for the very first time. ICR Cyprus holds a 30-year license for the provision of casino gaming across the Republic of Cyprus. Under the terms of that license, ICR Cyprus will be the exclusive casino operator of the tiny Mediterranean island nation for the first 15 years.
Melco and its local partner – the CNS Group – were announced as the winning bidders for the development of Cyprus’ first integrated casino resort in the fall of 2016 and were awarded their license in the summer of 2017.
ICR Cyprus currently operates three gaming properties in Cyprus – a temporary casino in Limassol, which opened doors last June and will remain operational until the main resort, which is currently under development, is launched in late 2021, as well as two satellite casinos in the capital Nicosia and at Larnaca International Airport. The satellite facilities kicked off operations in December 2018.
ICR Cyprus is also gearing up preparations for the launch of a third satellite casino in Paphos this summer, and of a fourth facility in Ayia Napa later this year.
As for City of Dreams Mediterranean, when launched, the property will feature a hotel with 500 rooms and suites, a casino with 100 gaming tables and more than 1,000 slot machines, international restaurants and cafeterias, MICE facilities, an outdoor amphitheater, and a number of other facilities. The luxury complex will be the largest of its kind in Europe and as mentioned above, will mark Melco’s debut on non-Asian soil.
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