SkyCity to sell 10% stake in Gaming Innovation Group

The news: SkyCity Entertainment Group has agreed to sell its entire 10% shareholding in European sports betting company Gaming Innovation Group, as part of its “ongoing prudent approach to capital management”.

The numbers: SkyCity said the net proceeds of the sale are around NZ$55 million ($50.6 million) after brokerage and legal costs. The casino operator acquired its stake in GiG in April 2022 for €25 million, around NZ$40 million at the time.

The context: SkyCity, which is currently facing an investigation over its suitability to hold its Adelaide casino license, said it intends to use the proceeds of the sale to pay down debt. It noted that it continues to have a valuable relationship with GiG through its involvement with the SkyCity Online Casino, which is operated from Malta.

However, SkyCity said that its shareholding in GiG, which is listed on the Oslo Stock Exchange and the Nasdaq Stockholm, was “non-core to its ongoing operations” and not considered strategically necessary for the company.

The troubled casino operator, which also admitted to breaches of anti-money laundering laws in New Zealand last month, has seen its share price lose 22% since the start of 2024. During this time, SkyCity’s CEO, CFO and COO have departed, and the company cut its earnings guidance and suspended dividends earlier this month.