SkyCity warned by NZ government over advertising breach
New Zealand casino operator SkyCity Entertainment Group has been warned by the government that its Malta-licensed online casino was flouting local advertising laws.
On Monday, the New Zealand Department of Internal Affairs issued a formal warning to SkyCity regarding its Malta-licensed SkyCityCasino.com site.
The DIA found that an email SkyCity sent its loyalty program members in March had breached rules against promoting internationally licensed online gambling sites.
SkyCity’s Malta-based subsidiary launched its Gaming Innovation Group-powered online casino in August 2019, offering a mix of RNG and live dealer casino games.
Customers were required to be physically located in New Zealand, despite the country having yet to authorise online casino gambling.
The offending email informed SkyCity customers that, while its land-based gaming operations had been halted by COVID-19, its online casino was “operating as usual”.
A customer viewed this pitch as contravening Kiwi rules regarding the promotion of prohibited gambling products and filed a complaint with the DIA, according to Calvin Ayre.
The DIA launched a month-long investigation, eventually concluding that SkyCity hadn’t ‘deliberately’ violated the Gambling Act 2003.
DIA director Chris Thornborough reportedly told the complainant that education was the DIA’s preferred first step regarding such complaints but the government would “take any further breaches seriously.”
A SkyCity spokesperson told local media that the March email was intended to simply “advise customers of the overall impact of the COVID-19 pandemic on SkyCity’s operations.”
SkyCity maintains that it didn’t break the rules but the company “respects the view of the department however and will take into account the feedback received.”
New Zealand did a better job than most countries of keeping a lid on its COVID-19 infection rate, resulting in SkyCity getting permission to partially reopen its casinos in mid-May.
The casinos were cleared for full-fledged operations last month but the country is still limiting who gets to enter the country from abroad, putting a serious dent in SkyCity’s international VIP gambling operations.
SkyCity enters into massive equity raising measures
New Zealand-based casino company SkyCity Entertainment Group has launched an A$215 million (NZ$230 million) equity raising to strengthen its balance sheet after shutting down during the coronavirus pandemic.
Perth Now reported in June that SkyCity board chairman Rob Campbell said despite encouraging trading since reopening in New Zealand, the outlook remains uncertain as the company adjusts to the new social and economic settings.
SkyCity said it had secured waivers from its debt covenants through to mid-2021 as well as NZ$160 million in new bank funding, which was contingent on SkyCity raising NZ$200 million in net funding.
“The equity raising will ensure that SkyCity remains appropriately capitalised and provides certainty to allow for the delivery of the strategic plan for the business,” Mr Campbell said.
The equity raising consists of a fully underwritten NS$180 million institutional placement and a NZ$50 million share purchase plan.
The institutional placement will be at NZ$2.50, a 6.4 per cent discount on its last closing price of NZ$2.67 on the NZX.
SkyCity said its New Zealand properties reopened last month, except for its Queenstown wharf casino, while it expected Adelaide Casino to reopen later this month.
A NZ$330 million expansion of the Adelaide Casino is still on track to be completed by October.
SkyCity said it has received an initial NZ$105 million insurance payment for the New Zealand International Convention Centre project in Auckland, which was hit by a devastating fire in October, after a worker apparently left an unattended blowtorch on the roof.
SkyCity said the NZ government had granted it a two-year extension on the NZ$750 million project, to January 2, 2025.