Unsolicited Offer for Sky City Entertainment Ltd shares

20 April 2011

Shareholders in Sky City Entertainment Group Limited should be wary of an offer dated 18 April 2011 from NZ Investment Securities LP (NZIS) to buy their shares for $2.30 per share.

The general partner of NZ Investment Securities LP is Mr Bernard Whimp. The Commission is currently taking legal proceedings against NZ Investment Securities LP and other limited partnerships associated with Mr Whimp.

The Commission considers that it cannot be in a shareholder’s interests to accept the offer for the following reasons.The amount offered per share is less than the current market price of the shares. The most recent market price for the shares is available on the NZX website at www.nzx.com,..

At 11.00am on 20 April 2011, the market price was $3.39 per share.

If a shareholder instead sold their through a broker, they would receive the full market price (less any fees payable).That means that any shareholder who sold their shares to NZIS today would lose around $1 per share - or around a third of their shares’ value.

In addition, payment for the shares will not be made until up to 14 days after NZIS has received notification from the share registry that the shares have been transferred. It is therefore likely that shareholders will not receive payment for shares sold under the offer for at least three weeks after they accept it.

If the shares were instead sold through a broker, a shareholder would likely be entitled to receive payment within 3 working days.

The offers suggest that there is an urgent need for investors to act on the offers. The Commission is not aware of any circumstances that would render this suggestion true.

It is not illegal to make an unsolicited offer to buy investments or to offer to buy them at a price below their current market value. However it is against the law to mislead or deceive investors into accepting an offer.

The Commission is aware that Mr Whimp, and some other people, have recently requested the share registers of a number of other listed companies and is concerned that a other unsolicited offers may be made in the coming weeks.

Any investor who receives an unsolicited offer is encouraged to treat such an offer with great caution - to carefully read the offer in full including any fine print anywhere on the forms, and to take the time to make a few important checks.

For further guidance, see the Commission's website www.seccom.govt.nz

ENDS

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