Rich Lister Sam Arnaout has outbid veteran Sydney hoteliers the Gravanis brothers in a race to acquire Casino Canberra from ASX-listed Aquis Entertainment, adding another trophy asset to his $5 billion hospitality empire.
Aquis – which is majority-owned by Hong Kong billionaire racehorse owner Tony Fung – said on Tuesday it had accepted a revised offer of $63 million from Mr Arnaout’s Iris Capital for all the shares in the Aquis subsidiary that owns and operates the casino.
The Iris Capital offer followed a bidding war with Bill and Mario Gravanis’ Oscars Hotels, which increased its original (and accepted) May offer of $52 million to $58.2 million last week in the hope of sealing the deal.
Iris Capital subsequently raised its offer to $60 million and then $63 million to secure the casino property and operating business, which has been struggling under the weight of a $33 million loan from Mr Fung after its revenues were hit by COVID-19 lockdowns and trading restrictions.
The Gravanis brothers own more than 30 hotels and pubs, including the Novotel Sydney Brighton Beach, Palm Bay Resort and Oakwood Hotel in Brisbane.
However, they could not compete with the financial firepower of Mr Arnaout’s Iris Capital, which owns one of the country’s biggest private hotel and pub portfolios and a substantial development business undertaking projects in Sydney, Newcastle and the Gold Coast.
The Canberra casino deal takes Iris Capital’s investment in new hospitality assets this month to about $220 million after it bought the Strathfield Hotel in Sydney for about $80 million and five properties in Alice Springs – three pubs and two accommodation hotels – for a combined $75 million.
It is also spending $100 million on revamping Alice Springs’ Lasseters Hotel Casino, including adding a new hotel to the property it paid $105 million for last year.
“We are excited about the opportunity to acquire Casino Canberra and look forward to working collaboratively with the Aquis team in the future,” Mr Arnaout said.
The sale of the casino is subject to approval by Mr Fung’s Aquis Canberra Holdings, which owns 88.5 per cent of Aquis, and casino and liquor licence regulatory approvals.
Should a superior offer be made, Iris Capital has an agreement with Aquis to have the opportunity to provide a counter-offer. Iris is also entitled to a $1 million break fee should its deal not proceed.
The casino acquisition follows Iris Capital swooping on the Gap Tavern, Todd Tavern, Diplomat Hotel, Mercure Hotel and Aurora Hotel in Alice Springs this week for a combined $75 million. HTL Property negotiated the deal.
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