Tsogo Sun has resolved to restructure its hotel interests under one holding company – THL – and to proceed with the separation of Tsogo Sun and THL, culminating in the listing and unbundling of THL.
Following the acquisition by Tsogo Sun of a controlling interest in Hospitality Property Fund (HPF), the hotel division has reached critical mass, Tsogo said in a release published on Friday.
Given that the gaming and hotel divisions operate in distinctly different markets and service different customers, there are limited opportunities to leverage synergies within the group as a whole. Therefore, this change will allow shareholders to directly participate in the gaming and hotel divisions of Tsogo, the company explained.
Tsogo plans to unbundle and separately list THL on the main board of the JSE.
Tsogo will then comprise only the gaming division, which it plans to rename Tsogo Sun Gaming.
THL will own, lease and manage hotels in South Africa, as well as in several sub-Saharan African countries, the Seychelles and Abu Dhabi. THL will also hold the group’s minority investment in RBH Hospitality Management and International Hotel Properties, based in the UK.
The hotels that have been developed as part of the various casino complexes owned by the group will be operated by THL under a management agreement.
The group’s 59.2% interest in HPF will remain owned and consolidated by THL.
As a consequence of HPF remaining a subsidiary of THL and concentrating primarily on hotel investments, Rob Nicolella will be stepping down as CEO of HPF and return to his previous position at Hosken Consolidated Investments once the proposed transaction is complete but will remain a nonexecutive director of HPF.
Mara De Lima, who has been the CFO of HPF for the past two years will be appointed CEO at that point.
Riaan Erasmus will be appointed to the board of HPF as CFO to succeed De Lima. Erasmus has previously held the position of group financial manager at HPF and acting CFO prior to the takeover of HPF by Tsogo.
Tsogo also announced the retirement of Jacques Booysen as CEO and as a member of the boards of directors of the group companies, with effect from June 30.
The board has resolved to appoint Chris du Toit CEO designate, effective July 1.