SkyCity Entertainment Group was elated when New Zealand lifted a week ago all restrictions put in pace due to the COVID-19 pandemic. This meant that the gambling provider could begin to get back on its feet and generate some much-needed income.
Whereas the lifting of the restrictions now seems to have possibly been a bit premature, since New Zealand has seen new cases of coronavirus, the country is in a better position to face the disease head-on. SkyCity will be able to, as well, as it just confirmed that it has figured out how to place NZ$230 million ($148 million) in the right column on its balance sheet.
The company has gone through the books and has emerged with multiple solutions to up its liquidity. One of the ways includes the underwritten placement of shares, worth about $116 million, to institutional as well as other investors. Another $32 million will be issued via a share purchase plan that will be extended to eligible shareholders in both New Zealand and Australia.
That amount will surely prove to be much useful, however, the firm isn’t stopping there with its plans. SkyCity has additionally taken up new debts worth around $103 million, and will be able to extend some existing bank-supported financial credit by another $110 million.
Combined, the company will end up with about $361 million to help it revamp, funds that it intends on ensuring goes to proper use.
In announcing the new plans, SkyCity Chairman Rob Campbell expressed enthusiasm, saying, “Over the past few months, SkyCity has faced challenges which have impacted the business and operations, particularly the disruption caused by COVID-19. Despite encouraging trading since reopening in New Zealand, the outlook remains uncertain as we adjust to new social and economic settings.
“Accordingly, the SkyCity board has resolved to increase liquidity and to provide additional financial flexibility for the business to protect against the prospect of a slower or more protracted recovery from the impacts of COVID-19. The equity raising will ensure that SkyCity remains appropriately capitalised and provides certainty to allow for the delivery of the strategic plan for the business.”
SkyCity had been running under altered lockdown restrictions since it restarted some of its venues on May 14. The announcement by New Zealand government last week that all restrictions would be ifted was a massive sign that things were starting to return to normal.
However, New Zealand suffered a blow this week when it was announced that 2 women had tested positive for coronavirus. The pair had travelled from the UK to visit a dying relative last week, and were never tested upon arrival.
Although the two women were in managed isolation, they were let to go free for “compassionate reasons”, and it was later confirmed that they were positive for COVID-19. There are now concerns that up to 320 people could have come in contact with these women and might be infected too.