KEY POINTS:
Sky City Entertainment Group Ltd says it is allowing a party to undertake due diligence which may potentially result in a firm proposal to buy the company.
The casino operator also said it would consider approaches from other parties interested in acquiring control of Sky City or merging with it.
Last Friday Sky City announced an unnamed party was showing interest in buying all the shares in the company at a "significant premium" to the company's recent share price.
The news sent Sky City's shares up as much as $1.23 to a record high $5.56 during the day, adding more than half a billion dollars to the market capitalisation. The shares closed yesterday at $5.05.
Today Sky City said its board also planned to actively approach other parties to assess their potential interest.
It noted that the interested party that had made the approach had insisted its identity remain confidential.
"However, the board advise s that it considers the interested party to be credible and its approach to Sky City to be genuine," Sky City said.
"The board continues to caution shareholders that there is no assurance that the approach received will result in any specific transaction."
Sky City also said that to avoid any market uncertainty, the board would continue to test market interest in Sky City Adelaide.
At the same time the sale process in relation to Sky City Cinemas was progressing as planned and, at this stage, the acquisition approach was not expected to have an impact on it.
A sub-committee of independent directors comprising Rod McGeoch, Sir Dryden Spring and Patsy Reddy had been set up to handle th e matter.
First NZ Capital, Credit Suisse and Bell Gully had been appointed as advisers.
- NZPA
