Las Vegas Sands to increase shareholding in Sands China

According to a Tuesday filing to Hong Kong’s stock exchange, the gaming operator’s parent company currently holds approximately 70 per cent of the company’s issued share capital.

The forthcoming share purchase is being carried out by procuring Venetian Venture Development Intermediate II (VVDI (II)), which is an indirect wholly-owned subsidiary of LVS and the immediate controlling shareholder of Sands China.

The transaction, which took place on 5 December, saw VVDI (II) enter into an agreement with a financial institution to acquire Sands China’s shares for up to HKD1.95 billion (US$250 million).

Based on the closing price of HKD20.2 per share on Hong Kong’s stock market at the time of the transaction, the funding amount is equivalent to approximately 96,600,247 shares, representing around 1.19 per cent of the total issued shares of Sands China.

In a note from J.P. Morgan Securities (Asia Pacific), analyst DS Kim described the share purchase as “meaningfully positive for Sands China”.

“The news signals strong confidence or commitment from management, which is something that is needed to stabilise (frustratingly) bearish investment sentiment of late,” he wrote.

According to J.P. Morgan, the planned amount of about HKD1.95 billion involved in the share purchase should not be considered insignificant compared to the total number of shares available for trading.

This substantial amount is equivalent to 6.5 days’ worth of Sands China’s trading value based on the average daily trading volume over the past three months.