SJM Holdings announces rights issue, term loan with STDM

SJM Holdings Limited has come to an agreement with its controlling shareholder, Sociedade de Turismo e Diversões de Macau, S.A. (STDM) for an unsecured term loan of HKD2 billion.

The loan is for a fixed period of six years from the date of drawdown and attracts interest at 4% per annum, SJM Holdings added in a statement announcing the news.

SJM Holdings is the parent company of Macau casino licensee SJM Resorts, S.A.

According to the statement, the loan was initiated to assist SJM Resorts in its bid for a 10-year validity casino license.

“STDM will provide the loan to SJM Holdings to enable the latter to invest in its principal subsidiary, SJM Resorts, as part of the increase in share capital which SJM Resorts is required to have to pre-qualify for the tender process by which the Macau Government may grant SJM Resorts a 10-year gaming concession commencing on 1 January 2023,” the statement said.

At the same time, SJM Holdings launched a rights issue by which it proposes to raise net proceeds of up to approximately HKD2.94 billion on the basis of one rights share for every four existing shares held on August 29 2022, at a subscription price of HKD2.08 per rights share and assuming no share options under SJM Holdings’ employee share option scheme are exercised.

Under the rights issue, STDM has agreed to take up its full entitlement – approximately 54.7% – and to apply for excess applications representing 50% of the maximum excess rights shares. The remaining 50% will be underwritten by BNP Paribas Securities (Asia) Limited. AL