Sun International pulling out of Nigeria
Sun International plans to exit Nigeria after the South African casino and hotel operator’s earnings in the country plunged amid a weakening economy and a dispute involving the company’s local partners, Bloomberg reported.
Sun International bought 49 percent of the Nigerian Stock Exchange-listed Tourist Company of Nigeria 10 years ago, giving it part-ownership of the Federal Palace hotel in Lagos, one of the main hotels used by businessmen travelling to the commercial capital.
Earnings before interest, taxes, depreciation and amortization at the Nigerian operations fell 58 percent in the 12 months through June, Sun said in a statement. Occupancy rates at the property fell to 42 percent.
“The Federal Palace continues to operate in a difficult environment with the Nigerian economy facing a number of crises including the low oil price,” the Johannesburg-based company said in the statement.
The Islamist insurgency led by the Boko Haram group and a weakening naira also hurt trading, while an “ongoing shareholder dispute has frustrated all attempts to develop and improve the property,” the company said.