Silver Heritage Group Ltd. announced that they have been given the permission to transfer NPR5 billion (US$48.3 million) cross-border in order to finish the new casino resort they are building.
The resort the Australian casino developer is currently building is called Tiger Palace Resort Bhairahawa and is located in Nepal. According to Silver Heritage representatives the amount of money they have been given the permission to operate with should be more than enough to cover the required expenses around the completing of the project. In a filing to the Australian Securities Exchange, the company stated that after this transfer they will be able to open the property for public use.
There have been some delays in completing the resort, which was stated in a regulatory announcement in February. Silver Heritage warned its investors that they are partly as a result of insufficient liquidity in the banking system of Nepal. There was also an unpredicted delay with the issuing of an approval for Silver Heritage to increase the equity ceiling of its corporate investment vehicle in Nepal. All these factors contributed to the company’s decision to suspend trading in its shares, effective from the 27th of February.
A week prior to the permission for money transfer given from the central bank, the Australian casino developer launched a fully underwritten by Baillieu Holst Ltd. share entitlement offer, seeking help to complete the property construction. The accelerated renounceable offer was aimed at potential investor and it targeted gross proceeds amounting to AUD19 million (US$14.4 million). This approximate amount of money is going to be used not only for funding the project and building it to completion but to provide working capital, as well as to pay the costs of the entitlement offer.
Eligible shareholders have the right to subscribe to two new Silver Heritage shares for each already existing share, according to the entitlement offer. The company announced that, as of July 4, a single share is held at an offer price of AUD0.05 per new share. This Tuesday the casino developer said that the trading of its shares will start anew after the completion of the institutional part of it entitlement offer. This retail component is scheduled to open on the 7th of July and close on the 26th of July, as it was stated in a previous filing.
Mike Bolsover, Managing Director and Chief Executive of Silver Heritage, said regarding the announcement they made on Thursday, that after a complex series of approvals, this was the final one which aims to increase the company’s direct investment in foreign projects, such as the one in Nepal. The initial budget for the construction of Tiger Palace Resort Bhairahawa was US$11.8 million, but it ultimately swelled up to US$51.8 million.