Reef Casino Trust (RCT), the operator of the Reef Hotel Casino in Cairns, Australia, has confirmed a higher takeover proposal from Iris Cairns Property, part of the Iris Capital group. The revised bid now values the trust at AU$185.3 million (US$119.1 million), with unit holders offered AU$3.72 (US$2.39) per unit in cash. This marks an increase from Iris’s earlier AU$3.55 (US$2.28) per unit offer and represents a 4.8 percent premium on RCT’s most recent closing price.
Shareholder and Board Backing
RCT’s board, including its independent directors, has unanimously recommended acceptance of the improved proposal, provided no competing offer arises and the independent expert’s assessment remains favorable. The move follows Iris Capital’s earlier AU$177 million (US$116 million) bid announced in July, which initially valued units slightly above AU$3.55 each.
The trust’s two largest unitholders, Accor and Casinos Austria International, who together hold more than 71 percent of RCT, have already confirmed their support for the revised transaction under the same conditions. This shareholder endorsement gives significant momentum to the deal, making it more likely to proceed to completion.
As published in the ASX Announcement (pdf), the updated offer not only increases the purchase price but also modifies certain contractual provisions. The break fee has been raised to nearly AU$1.9 million (US$1.2 million), reinforcing Iris Capital’s commitment to the deal. In addition, competition approval requirements have been removed after Iris obtained clearance earlier this month, removing a potential hurdle to closing.
According to RCT, the latest bid values the trust 36 percent higher than in February, prior to Iris Capital’s first approach. This premium underscores the strength of the proposal compared to recent trading history, with the July 11 closing price reflecting a 17.69 percent premium and the February 25 price reflecting a 30.19 percent premium at the time of the initial offer.
Strategic Expansion for Iris Capital
For Iris Capital, the acquisition represents a significant expansion of its casino and hospitality portfolio. The group already operates two casinos in Canberra and Alice Springs and owns more than 60 hotels across Australia. Securing Reef Casino Trust would extend its presence in the gaming sector while adding one of Queensland’s key entertainment venues to its assets.
The Reef Hotel Casino, RCT’s sole property, is a well-established entertainment complex in Cairns, North Queensland. With Iris Capital’s takeover, the casino would become part of a broader network of gaming and hospitality assets, bolstering the company’s footprint in the Australian market.
Reef Casino Trust has confirmed that negotiations with any competing bidders have ceased under the terms of the Takeover Bid Implementation Agreement. A detailed summary of the transaction will be provided to unitholders in late September. In the meantime, the board continues to recommend the Iris Capital offer in the absence of a superior alternative and subject to the independent expert’s final assessment of fairness and reasonableness.
If completed, the deal would see Iris acquire all 49.8 million RCT units, providing full control of the trust and solidifying its long-term investment in Australian gaming and hospitality.
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