SkyCity Entertainment's $220 million deal to sell its car park concession is at risk of falling through as the facilities are unlikely to be ready to hand over by next month's deadline.
A deal was signed for the sale of the casino's car parks the same year as a massive fire at the International Convention Centre. Photo: Supplied / SkyCity
Macquarie Principal Finance bought the concession to operate SkyCity's 3200 car parks in Auckland early in 2019, before the facilities were significantly damaged in a fire at the International Convention Centre later the same year.
"While reinstatement of the car parks is underway it is likely they will not be delivered to Macquarie on time," SkyCity chief financial officer Julie Amey told investors earlier this week, warning Macquarie would be in a position to terminate the deal on 22 October.
"To date Macquarie has not indicated their intention," she said.
"As you would expect, we are progressing credible options for financing a potential buyback should Macquarie exercise their rights.
"These options range from viable self-help using existing resources through to securing new debt that fits within our longer-term capital management strategy."
She said if the deal was terminated SkyCity would take back operational control of all of the car parks covered by the concession agreement.
Amey said the Auckland casino's car park business was a key driver for local gaming visits, generating annual underlying profit of between $15m to $20m.