Casino rival plays cash card

By PAUL PANCKHURST

Queenstown's Skyline Enterprises yesterday fired a new salvo at listed gambling giant SkyCity Entertainment in the war over the Christchurch Casino.

Skyline chairman Barry Thomas said the company would withhold a planned $1.2 million capital injection for the Queenstown casino, which is owned 60 per cent by SkyCity and 40 per cent by Skyline.

This was, he said, retaliation against SkyCity's "back-door attempts" to buy into the Christchurch Casino.

However SkyCity Entertainment Group managing director Evan Davies said that "at no time has SkyCity requested any funding assistance from Skyline Enterprises, nor is it likely to do so."

SkyCity had always been open with Skyline, said Davies, and if Thomas wished to talk about the issue he knew the appropriate forum.

Thomas would not expand on what impact withholding the cash would have on the Queenstown operation.

"SkyCity must decide whether it wants to partner Skyline in Queenstown or oppose Skyline in Christchurch - it can't do both," he said.

"We're not at all happy about being SkyCity's banker in Queenstown while they try to heavy their way into our privately owned Christchurch Casino via the back door."

The wrangle between Skyline and SkyCity erupted in public on December 16, when Thomas claimed SkyCity was trying to buy British gambling house Aspinall's stake in the Christchurch casino.

SkyCity later confirmed that it had been in discussions with Aspinall.

Skyline and Aspinall each own 30.7 per cent stakes in the Christchurch operation, one of only six licensed casinos in New Zealand.

Indirect holdings lift each of the companies' levels of control to 41 per cent.

Christchurch Casino's long-serving managing director, Arthur Pitcher, a representative of Aspinall, stood down from the board before Thomas went public with his claims.

Thomas linked his move with reports of SkyCity's interest in Aspinall's stake, and said it was "to put him in a neutral position".

Aspinall has threatened legal action to get Pitcher back on the board.

Adding another twist to the story, Christchurch businessman Earl Hagaman, a major investor in the Dunedin Casino, claims to have a group of six Christchurch investors ready to buy out Aspinall.

SkyCity is the dominant owner of casinos in New Zealand, with the country's largest casino, in Auckland, plus majority stakes in the Hamilton casino and the Queenstown venture, which is one of two casinos in the town.

The Casino Control Authority must give prior approval to casino shareholding changes.

Expansion into Christchurch would appeal to SkyCity because a Government moratorium prevents new casinos opening and existing casinos expanding.

If SkyCity bought Aspinall's stake, it would effectively have an interest in five of the country's six licensed casinos instead of three, as at present.

That is because the Christchurch casino also has a stake in the Dunedin casino.

Skyline has indicated that it could be interested in the Aspinall stake - subject to certain unspecified condition.

Thomas said Skyline would put the $1.2 million into the Queenstown casino as soon as Davies "gives an assurance the Auckland group no longer has designs on Christchurch".