Genting Berhad has issued a third tranche of notes in as many weeks under its MYR10 billion (US$2.40 billion) Medium Term Notes Programme as efforts to fund the ongoing acquisition of shares in Genting Malaysia continues.
The company revealed in a filing that wholly-owned subsidiary Genting RMTN has issued MYR255 million (US$61.7 million) in notes, following the recent issuance of MYR900 million (US$216 million) and MYR495 million (US$119 million) in notes earlier in November.
Genting Bhd, which in mid-October launched a conditional voluntary takeover offer for subsidiary Genting Malaysia – now a mandatory takeover offer – has seen its stake in the company increase from 49.36% at time of the initial announcement to 64.118% as of Friday.
The company said in its latest filing that the net proceeds raised from the latest issuance of medium-term notes “shall be utilised by the Company to part-finance the acquisition of all remaining ordinary shares in Genting Malaysia Berhad (excluding treasury shares) which are not already held by the Company.”
Genting’s takeover bid is linked to the group’s desire to own a larger stake in Genting Malaysia’s Resorts World New York City should the property be granted a full commercial casino license as expected. That decision could be made by New York officials as early as Monday, with an announcement likely before the end of the year.
Aside from Resorts World New York City and Resorts World Catskills parent Empire Resorts, Genting Malaysia also controls the group’s Malaysia flagship Resorts World Genting.
Notably, Maybank Investment Bank has suggested that Genting Malaysia shareholders should reject the takeover offer of MYR2.35 per share because it undervalues the company based on latest projections.
However, Nomura analysts have expressed doubt over Genting Bhd’s ability to achieve its ownership goals, suggesting in a recent note that it will likely reach around 65% ownership of Genting Malaysia instead – a stake it is quickly closing in on.
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