Club Mykonos seeks to realise its casino investment

Club Mykonos shareholders can expect a substantial dividend provided that the company successfully concludes the sale of all its casino shares, according to a company media release.

The prospects of a “substantial dividend” was recently advertised by Club Mykonos in a cautionary statement in national newspapers on November 10.

Casino Mykonos is one of South Africa’s most profitable “small casinos”. In its half year to end-June it reported revenue of R50 million and gross profits of R22 million.

According to the media release, Club Mykonos is currently still in negotiation with the prospective buyer of its casino shares and it intends to distribute part of the proceeds of the sale to its shareholders as a special dividend.

The cautionary also stated that the remaining proceeds of the deal would be retained as working capital. This will enable the company to carry out further developments without having to rely on bank finance, says Mr Phil Calothi, the Managing Director of Club Mykonos.

During the past seven years, Club Mykonos has developed and sold out several very successful private estates in the Langebaan area which include Paradise Beach, Calypso Beach, Blue Lagoon, Sunset Estate and Apollo Ridge which comprise in excess of 1 000 plots.

The cash profits generated out of the developments were largely responsible for Club Mykonos acquiring sufficient cash before December 31 last year to enable the company to repay its R116m debenture debt in full.

According to Calothi, Club Mykonos intends to now concentrate on realising the value of its undeveloped properties and resort commercial businesses towards generating future returns and increased share value for its shareholders.

The company’s most recent development, Aegean Heights, is its most exclusive development to date in that the bulk of the plots situated immediately adjacent to the rocky shoreline of Langebaan Lagoon with uninterrupted sea views.

Calothi expects a final agreement will be signed shortly regarding the sale of the company’s casino shares whereafter the transaction will be presented to shareholders for approval.

He advised that a general meeting will be convened early in the new year for this purpose and that, should the transaction be approved, the special dividend will be paid to shareholders on a date as soon as possible still to be determined.

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