According to share ownership records, Tsogo Sun Gaming, Africa’s largest casino operator, has acquired a 5% stake in City Lodge, the leading South African hotel chain.
Tsogo Sun Gaming affiliates HSS Investments and Entertainment Holdings made the investment, which could signal the casino operator’s intention to reenter the hotel business in 2019.
According to Refinitiv and the company, HSS Investments and Entertainment Holdings owned up to 5% of City Lodge as of mid-May.
Although the two unlisted entities are not widely known to be subsidiaries of the gaming companies’ register reveals that they share an address with the it and are led by some of the same directors.
An analyst at an asset management firm confirmed the link between the two unlisted companies and Tsogo Sun Gaming.
Tsogo Sun acquired shares in City Lodge through two separate entities beginning in January, according to an analyst who requested anonymity because his firm has financial stakes in these companies.
However, on May 15, City Lodge announced that HSS Investments’ “beneficial interest in the securities of the Company (City Lodge) now amounts to 5.0%.”
City Lodge made no mention of Entertainment Holdings or any connection to Tsogo Sun.
Before the pandemic, City Lodge stock was worth about $0.2484 (or 4.60 rand) per share, and it was trading at that level on Tuesday. This is less than the company’s stated replacement value for its assets in February, which was around 10.60 rand per share.
