Century Casinos, Inc. announced today that it has agreed to sell its interest in the Gauteng, South Africa, license application. In 1997, Silverstar Development Limited (Silverstar), along with Century Casinos, Inc. (Century), had made an application to the Gauteng Gambling Board (GGB) for a casino license in Gauteng, South Africa.
After a series of legal challenges and lawsuits, the license is still unresolved with the GGB having seen fit to prolong the legal dispute through the Supreme Court, resulting in Silverstar not being able to commence with the casino development. Silverstar has immediate pressing financial needs beyond the level which they or Century would consider supporting, considering the legal uncertainties unresolved and bearing in mind the long history of the project. The Akani Group which is comprised of Akani Leisure Investments (Proprietary) Limited and Gold Reef Casino Resorts Limited (partly owned by the Casinos Austria group) has agreed to provide the funds necessary for Silverstar to complete the project and to acquire the entire shareholding of Silverstar as well as all assets, rights and obligations of Century in the project
The total selling price to Century is R50,3 million, approximately $8.5 million. An initial payment of R10.0 million, approximately $1.7 million, has been received today for the sale of land owned by the Company’s South African subsidiary for the casino site and reimbursement of expenses and previously advanced funds to Silverstar. The balance of R40.3 million, approximately $6.8 million, is contingent on certain approvals being secured by Silverstar and the Akani Group. The outcome of these approvals is unknown at this time but with the financial backing of the Akani Group, funding is now available to Silverstar to complete its tasks and provide a higher level of assurance that Century will ultimately get a return on its efforts to date. Should such approvals not be obtained, Century’s involvement in the project will be restored to the previous level of ownership and management.
“The legal process in which Silverstar is embroiled in was demanding an increasing amount of management’s time. The financial and management distraction for the Gauteng project had to be considered in light of the various exciting North American opportunities that have been secured. We believe the later represent a better use of Century’s resources and look forward to completing this transaction to further grow Century Casinos, Inc.”, said Chairman and CEO Erwin Haitzmann.