Miloumor (TASE: MILO), controlled by Freddi Robinson, is considering the separation of its 15% stake (through subsidiaries) in the Loutraki casino in Greece from its other business. Miloumor is mulling an issue of its stake on the Tel Aviv Stock Exchange (TASE) in an attempt to enhance its value. The TASE is giving a huge discount on the Miloumor share, compared with the market cap of Queenco (TASE: QNCO), which has the same stake in the Loutraki casino.
Miloumor’s current market cap is NIS 252 million, compared with NIS 468 million for Queenco a 45% discount. The value of the Loutraki casino, estimated at $500-700 million, will be used to determine the price if the issue goes through.
Together with Club Hotel Eilat, Miloumor and Queenco control the successful Loutraki casino. Through a jointly owned company, Resido Tourism Invesment BV, the two companies hold 30% of the shares in the casino, as well as a much less profitable casino on the island of Rhodes. Miloumor’s other business, which is in real estate, is also harming its results, at least at the moment. Miloumor finished 2003 with a NIS 16.7 million profit, compared with Queenco’s NIS 35.1 million profit. Miloumor earned an NIS 8 million profit in the first quarter of this year, compared with NIS 12.4 million for Queenco.
Last year, Miloumor acquired the entire 50% stake of Queenco, controlled by Yigal Zilka, in their joint real estate company, Resido - C. Miloumor Ltd., in exchange for assuming a $23.8 million loan from Queenco to Resido - C. Miloumor. The loan will be repaid over eight years. Resido - C. Miloumor’s projects include 717 housing units in Beit Shemesh; 168 housing units, a shopping center, and an office tower in Ashdod; and Ahuzat Savyon, an assisted living facility that includes 193 housing units and a nursing hospital for senior citizens.
The Loutraki casino, built as part of the Greek government’s plan for privatization of gambling, opened in late 1995, and became an instant hit, surprising even its developers.
Published by Globes [online] - www.globes.co.il - on August 5, 2004