Our Great African Hospitality & Gaming Mega-project...: for sale


Our Great African Hospitality & Gaming Mega-project...

Africa

NEGOTIABLE
POR

Agent: Cliff Jacobs - Managing Principal Estate Agent & CEO (Nat.Dpl.Hotel Man (UJ). M.P.R.E.)
Agent Cellphone: +27 (0) 84 413 1071 / +27 (0) 61 716 6951
Agent Office Number: +27 (0) 21 554 0283
Agent Email Address: cliff@exquisitehotelconsultants.com
Type: Hospitality Project
Bedrooms: 0
Bathrooms: 0
Parking: 0
Yield: 7,8%


BACKGROUND

"One-fifth of the world’s
youth population
live in Africa"

The African economy grew by 2.9% in 2019, outpacing GDP growth in each of the EU’s five biggest economies (Germany, France, UK, Italy and Spain), and its expansion is projected to accelerate to 3.2% in 2020 and 3.5% in 2021, according to the UN. Economic growth helps tourism and gaming flourish. Africa is the only region in the world where the youth population is increasing. By 2050 Africa’s young people, i.e. those aged between 0 and 24 years old, will increase by nearly 50 percent. Africa will have the most significant number of young people worldwide. Africa’s youth and growing middle class are critical to the continent’s future.

HISTORY THE FUND

Our funding company evolved out of a strategic alliance between a top-end hospitality and Paradise Hospitality and Leisure Operators and an equally top-end Gaming Management operator. Both companies are experts in their fields and have come together to maximise opportunities for significant returns in Sub-Saharan Africa. From their sectoral expertise, local knowledge and extensive contacts they have been given the opportunity to acquire prime assets that they have recommended to our board for investment.

THE FUND

Our funding company, a protected cell private company with a category 1 global business license incorporated under the laws of the Republic of Mauritius, governed by the Companies Act 2001 and the Financial Services Act 2007. The fund proposes to raise finance for the acquisition of hotels and gaming licenses in Sub-Saharan Africa. It is to be managed by experienced management companies specifically chosen for their knowledge of the African market and experience garnered from years of hands-on African operations.

INVESTMENT

The investment is by way of a minimum $100,000 USD investment for non-participating shares in one or both of our company's designated gaming or hospitality cells (sub-fund).

INCOME OPTION

Hospitality cell: will generate earnings from the appointed Hospitality and Leisure management company and will pay 5% monthly in arrears on the investment amount. There is an additional performance payment of 15% on EBITDA per annum.

Gaming cell: will generate earnings from the appointed Gaming Management company and will pay 5% monthly in arrears on the investment amount. There is an additional performance payment of 15% on EBITDA per annum.

Investor income: Dividends will be paid once a year to the holders of participating shares. Under the current laws of Mauritius, dividends will not be subject to withholding tax on dividends and interest. No capital gains tax is due and in addition, there are no exchange controls in force so funds can be repatriated freely.

OUR VISION

TO OPERATE SUCCESSFULLY IN THE AFRICAN HOSPITALITY AND GAMING MARKET AS THE TRUSTED LEADING BRAND THROUGH PROFESSIONALISM, ACHIEVEMENT, SOCIAL RESPONSIBILITY AND THROUGH OPTIMAL SHAREHOLDER RETURNS

1. KEY OBJECTIVE

To offer investors direct access to high-growth opportunities in Sub-Saharan Africa with a diverse portfolio of safe and higher-earning investments. A diversified portfolio with a variety of similar products and markets will spread risk and ensure to build shareholder value.

2. INFLUENCE AND OPPORTUNITIES

The following factors influence the decision in selecting opportunities:

• Favourable policy and political reform
• Sustained high economic growth
• Supply-demand mismatch
• Reduce risk with strong local or government partnerships

3. HOSPITALITY SUB FUND

Acquire under-performing distressed properties at below market value and provide turnaround management and services.

4. GAMING SUB FUND

Launch new or digital versions of popular gaming products such as lotteries or sports betting in the world’s fastest-growing digital and gaming market.

5. FINANCIAL

Levelling the financial playing field:

Analyse the opportunities in a much more rigorous manner, actually understand how the local markets work, how the hotel or gaming license compares against its competitors then determine how much the fund can invest.

6. RESPONSIBILITY

Sustainable, ethical and socially responsible:

Our company believes that responsibly and ethically run hospitality and gaming projects will assist with local employment and raise funds for local social causes, supporting local communities.

MARKET CONSIDERATIONS - GAMING

THE AFRICAN ONLINE GAMING MARKET

The gaming industry in Africa is expected to register a CAGR of 12% during the forecast period (2020-2025). Mobile gaming generates close to half of the revenue that the gaming industry gets annually. More than 200 million Africans are below 35 years, and this figure might double in a decade. As mobile tech spreads around the continent, large swaths of Africa are paving the way for legal betting and gaming.

A big consideration in the Africa market is the payments and money-transfer systems available, especially the development of “mobile money” via USSD transfers. By charging payments directly to the user’s mobile phone bill, it means that operators are able to get around the issue of the huge number of unbanked consumers in Africa. Making a deposit through the mobile deposit method merely requires having a mobile phone connected to a participating mobile provider. Other forms of payment are also available from credit cards and e-wallets to bank transfers and prepaid cards.

  • 3,3 billion people live in areas covered by mobile broadband networks 
  • African online gaming industry generates USD $18 billion each year
  • 65% of the population are under 35
  • 50% of African play mobile games
  • 25% use Smartphones

HOSPITALITY MARKET CONSIDERATIONS

THE SECOND FASTEST GROWING TOURISM REGION WORLD

Africa tourism and travel recorded 5.6% growth in 2018 placing it second against Asia pacific and 1.7% above the global average of 3.9%. Travel and tourism remains one of the continent’s key economic growth drivers, contributing 8.5% (USD $194.2bn) of the GDP in 2018; from 8.1% and 7.8% in 2017 and 2016 respectively.

The African Continental Free Trade Area (ACFTA) includes 54 countries as of 2020 and is expected to further boost intra-regional business. A free trade area means more people will have the opportunity to travel across borders. There will be more business travel especially for MICE (Meetings, incentives, conferencing, exhibitions and events) as businesses seek to attract regional partnerships and investments. Moreover, the free movement of persons will boost business travel, even as we see a rise in bleissure, the combination of business and leisure travel. Medical tourism will grow, as patients receive visa-free facilitation to seek medical treatment in other African countries with advanced medical facilities.

HOSPITALITY FUND CELL

THE FUTURE OF THE HOSPITALITY FUND CELL

City Hotels

With the growth of Africa’s middle class and the reduced visa restrictions are increasing business travel around Africa supported by the growth of low-cost airlines and increased air connections between major African cities. Additionally, the current branded hotel supply is predominantly targeted at affluent international travellers supported by major European and
international hotel brands.

There is space for a unique African experience with a high focus on technology and hotel experience targeted directly at the African youth population. The brand will be targeted at the at the under 35’s at the mid
scale market to cater for African regional, domestic travel and business travel.

The key future investment opportunities will be focused around further expansion into core city locations around Sub-Saharan Africa that have strong African regional flight connections, relaxed visa requirements and good domestic demand. Further opportunities are developing in East Africa such as Kenya, Zambia and Ethiopia.

Resort Hotels

Traditionally supported by the strong domestic and some regional travellers has continued to growth year on year the market is changing and developing. Africa Governments embracing the hospitality sector as a vehicle for change. They have been investing in infrastructure projects that support tourism and supporting marketing activities both domestically, regionally and internationally. This support has poised Africa to dominate the MICE industry. Africa offers the opportunity for hyper-personalised and unusual venues and can link in with companies Corporate Social Responsibility by offering a host of opportunities for delegates who want to give back.

As investment flows into Africa the new opportunities around the extended-stay market to support long-stay business travellers from Europe and the USA making longer than normal trips due to business or projects, expatriates relocating and waiting for permanent accommodation, aid agencies, bodies such as the UN and World Bank, teams of consultants.

The primary focus will be identifying resorts that have good conference facilities to support MICE, options for corporate responsibility for delegates, opportunities to develop the extended-stay market and supported government infrastructure.

RELEVANT TAX CONSIDERATIONS

JURISDICTION

Mauritius fund structure

TAX CONSIDERATION

Our company is a GBL 1 company incorporated in Mauritius. It will qualify as a tax resident of Mauritius and will be effectively managed in Mauritius. The company should therefore be entitled to rely on the various double taxation agreements (DTA’s) in place with Mauritius.

Taxation of income earned in Mauritius

As a GBL1 company, our company will be subject to tax at the rate of 15%. The rate may be reduced by claiming credits for any underlying withholding taxes or corporate tax paid, or alternatively claiming a deemed credit of 80% in respect of any income earned. As a result, the maximum tax rate should therefore be 3%. Our company will receive income in the form of 5% net of investment and 15% of EBITDA, and/or management fees and dividend flows from the underlying Fund entities. Effectively, dividends will not be subject to tax in Mauritius if foreign taxes suffered are greater than 15%. For all other foreign income received i.e. interest and performance/management fees, it is possible to apply the deemed credit method in which case a maximum of 3% tax will be payable by the company.

Remittance of income

Withholding tax will not be levied in Mauritius on dividends or interest remitted by Ayoka. Nor are there any exchange control restrictions or capital gains tax implications that need to be considered.

CONCLUSION

This fund is the first of its kind in offering investors opportunities to sub-Saharan Africa in the hospitality & gaming sectors

Our Fund is the first Mauritius Fund to offer investors access to high growth opportunities in Sub-Saharan Africa in the hospitality and gaming sectors. Our Fund offers investors the opportunity to participate in a high return US dollar-based fund with the assurance of strong incomes. The Fund has carefully assessed those countries which offer the best balance of quality income assets, stability, growth and economic diversity. The strategy is the establishment of critical mass in each country such that the Fund’s resources, which will be expanded commensurate to the portfolio size, will be optimised and assets maximised. The team has a comprehensive working knowledge, understanding and development network throughout Africa and beyond. This intellectual property will be fully leveraged to substantially grow the Fund.

(All further questions and enquiries should be directed to Cliff Jacobs, Managing Principal and CEO of Exquisite Hotel Consultants. His contact numbers are +27 21 554 0283 (landline) or +27 84 413 1071 (mobile). His email is cliff@exquisitehotelconsultants.com).





Contact agent
Key features

THE PROJECT AT A GLANCE

OFFER SIZE

Issue of 3,000,000 shares

OFFER PRICE

USD $10.00 per share

LOCATION

Mauritius

FREE FLOAT

80%

MARKET CAP

USD $210,000,000

(Anticipated market capitalisation at date of transfer of all acquisitions)

INVESTMENT ROUNDS

• Series A USD $30,000,000
• Series B USD $60,000,000
• Series C USD $120,000,000

NUMBER OF ASSETS

7 Hotel Resorts,
6 City Hotels,
9 Gaming Licences

SECTORAL PROFILE

29% Resorts Hotels,
25% City Hotels,
21% Gaming Land Based
25% Online Gaming

FORWARD YIELD

7.8%

(Indicative 12-month forward yield)

GEOGRAPHIC SPREAD

Sub-Saharan Africa

AVERAGE ESCALATION

8.47%

(Weighted average escalation)

LOCATION OF INVESTMENTS

South Africa, Swaziland,
Botswana, Zimbabwe, Ivory
Coast, Niger, Burkina Faso,
Burundi, Tanzania

(All further questions and enquiries should be directed to Cliff Jacobs, Managing Principal and CEO of Exquisite Hotel Consultants. His contact numbers are +27 21 554 0283 (landline) or +27 84 413 1071 (mobile). His email is cliff@exquisitehotelconsultants.com).

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Cliff Jacobs (Nat.Dpl.Hotel Man. (UJ). M.P.R.E.)

Managing Principal / CEO

Exquisite Hotel Consultants (Pty) Ltd

Mobile: +27 (0) 84 413 1071 / +27 (0) 61 716 6951
Landline: +27 (0) 21 554 0283
Emailcliff@exquisitehotelconsultants.com
Skype: cliff.jacobs

Terms and Conditions apply



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