Kerzner wins key stake in battle over Wembley

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The Independent Online

Sol Kerzner, the Caribbean casino magnate, yesterday moved a step nearer to snatching Wembley from his archrival MGM Mirage after securing the right to acquire 22.3 per cent of the gaming and racetrack group.

Sol Kerzner, the Caribbean casino magnate, yesterday moved a step nearer to snatching Wembley from his archrival MGM Mirage after securing the right to acquire 22.3 per cent of the gaming and racetrack group.

Active Value, the activist fund manager, has promised to sell the rest of its 22.3 per cent stake in Wembley to Mr Kerzner's consortium, BLB Investors, but only if BLB launches a bid for the UK group by 30 March.

Analysts said BLB's move - provided it tables an 800p-per-share bid - would scupper MGM's agreed £260.5m offer for Wembley. To succeed, MGM, which structured its bid as a scheme of arrangement, needs approval from 75 per cent of Wembley's shareholders at a meeting on 8 April. "If BLB attain 22.3 per cent this would make that pretty close to impossible," Greg Feehley, at Altium Securities, said.

It is not clear whether Wembley's other major shareholders - who between them own more than 30 per cent - will back Mr Kerzner's move. Neither is it clear whether his bid would win over the US regulators, who may find fault with the fact that Mr Kerzner has a large casino business in Connecticut, which borders Rhode Island, home to Wembley's prime asset, the Lincoln Park racetrack and casino.

BLB, which is 50 per cent-owned by affiliates of the US real estate investor Starwood Capital, said a bid for Wembley was not certain. It said any offer would depend on due diligence.

BLB burst on to the scene earlier this month, when it acquired an 8 per cent stake in Wembley from Active Value for 800p per share. A bid at this level would value Wembley at £277m.

Wembley's shares closed up 4.5p yesterday at 847.5p.

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