Aquis CEO departs to run Casino Canberra as multimillion-dollar deal settles
The listed company has bid farewell to chief executive Allison Gallaugher and could soon say goodbye to the sharemarket after the sale of Canberra’s only casino.
Aquis Entertainment is considering delisting after the Tony Fung-controlled group finalised the sale of Canberra’s only casino to Sam Arnaout’s Iris Capital for $63m.
On Tuesday, Aquis told investors it expected to make a decision about the use of the funds from the sale and the future of the company by the end of the month.
As part of the sale, ASX-listed Aquis will repay a $20.4m loan to a group controlled by Mr Fung in exchange for the forgiveness of all accrued interest, some $7.8m.
Aquis said it had also appointed two directors at the request for Mr Fung – Simon Chan and Tom Pickett – while its chief executive, Allison Gallaugher, would leave the company and continue to lead Casino Canberra, now under Mr Arnaout’s ownership.
Russell Shields, Aquis’ chairman, said Ms Gallaugher had put in a “remarkable effort over the last few years in building a very successful business during very difficult times, through the Covid-19 pandemic and challenging times for the casino industry”.
“The business is in very good shape and I am sure will remain so under Allison’s, and Iris’s stewardship in the future.”
Aquis had been attempting to offload Casino Canberra – which it acquired in 2014 for just $6.5m – since 2018, when it agreed to sell the asset to iProsperity, a now collapsed property group run by Michael Gu, who fled the country in 2020 amid fraud allegations.
Mr Gu had asked for more time to finalise the deal, a request refused by Mr Fung.
Aquis later found a buyer with pubs group Oscars, which made a $58.2m offer for the business before it was trumped by Iris. The deal to sell to Mr Arnaout, first announced in July, came a year after Iris purchased his first casino, Lasseters in Alice Springs.
Mr Fung, a Hong Kong-based billionaire, is a major player in horse racing and breeding but retired as chairman of Aquis in 2021, saying the board needed to be independent. Mr Fung holds just under 90 per cent of Aquis. The ACT in 2018 rejected a proposal by Aquis to transform the casino and the surrounding precinct. Aquis shares fell 1c, or 6.3 per cent, to close Tuesday at 15c.
HTL Property managing director Andrew Jolliffe in 2022 told The Australian that the country’s casino market – there are 13 in total, ranging from major operations in Sydney, Melbourne and Brisbane to smaller businesses in Townsville and Launceston – had seen a period of “intransigence”.
“Those hoteliers now have the assets to participate in those transactions,” he said of publicans like Mr Arnaout, who owns numerous pubs, and most recently acquired the Wisemans Inn Hotel in Sydney for $10m.
“Domestic casinos very clearly have to prosecute the total experience patron base, not mono or zero channel entertainment levers. I think they’re doing that but to the extent that they’re not, then these guys have the experience and financial capacity to deliver on those things.”
Ms Gallaugher, who has run the Canberra casino since 2019, said: “As a board, we are very pleased to have been able to negotiate and complete this transaction, which provides significant benefits to all stakeholders.”
“As a CEO and employee, I am very excited to lead the Casino Canberra under Iris ownership and we look forward to continuing to grow the strong results we have built over the past few years and for the opportunities available for us all with Iris moving forward,” Ms Gallaugher added.
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