A proposal by Hong Kong’s Argyle Street Management Limited to acquire 100% of the shares in ASX-listed, Southeast Asian casino operator Donaco International Ltd that it doesn’t already own is one step away from becoming reality after Donaco shareholders on Monday approved the move.
In a filing, Donaco said that 98.11% of votes cast at a Scheme Meeting were in favor of the scheme, including 77.50% of votes cast by those who were present and voting.
The acquisition by Argyle Street Management’s special purpose vehicle, On Nut Road Ltd (ONR), will now require approval by the Supreme Court of New South Wales at a hearing scheduled for this Thursday 7 August 2025, after which time Donaco said it intends to lodge a copy of the orders of the Court with the Australian Securities and Investments Commission on Friday.
Privatization is expected to be complete on Tuesday 19 August assuming court approval and the satisfaction of outstanding conditions precedent.
As previously announced by Donaco, ONR – which holds 12.84% of Donaco’s issued share capital – will pay AU$0.045 per share, representing a 50% premium on the company’s closing price of AU$0.030 at ASX market close on Friday 14 March and a 54.10% premium to the 90-day volume weighted average share price as of 14 March.
The scheme values Donaco, whose casino assets comprise Star Vegas in Poipet, Cambodia and Aristo International in northern Vietnam, at AU$55.59 million (US$35.2 million).
The Non-Executive Chairman of Donaco, Porntat Amatavivadhana, previously outlined a series of ongoing challenges facing the company as providing good reason to sell while the opportunity presented itself.
“While Donaco has performed steadily in the last few years and has emerged from the pandemic, the company’s financial headwinds have been compounded over the years due to limited profit margins and a lack of substantial Investor confidence,” he stated in March.
“This has made fundraising efforts for any form of growth particularly challenging. The dependence on a single, major shareholder for financial stability becomes even more critical in light of the economic strains brought about by the pandemic.
“Moreover, the new gaming legislation in Thailand to introduce casino franchises in Bangkok could significantly impact the flow of patrons to Donaco’s border casinos. In addition, the impact on costs due to recent actions to cut power along certain towns between Thailand and Cambodia, resulting in intermittent power supply, further complicates our operational conditions.
“Considering the prevailing border issues and uncertain electricity supply, this may present a unique opportunity for Donaco shareholders that may not arise again.”
Donaco last week released its financial results for the June quarter, which highlighted further negative impact at Star Vegas from the ongoing border dispute between Thailand and Cambodia.
Argyle Street Management, which is reportedly controlled by Thai hotel billionaire Chanin Donavanik, first invested in Donaco through ONR in 2019 after acquiring some of the shares seized from Donaco founder Joey Lim by Orchard Capital Partners after Lim defaulted on a loan repayment in November 2018.
That transaction ultimately saw ONR trigger a boardroom cleanout that included placing two of its own directors on the company’s board.
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