Third bid to open Masa Centre casino launched

Despite two unfavourable High Court rulings, those behind the Masa Centre casino at the new Gaborone central business district (CBD) are still determined to get the licence. In their latest bid, they have mobilised more financial muscle and legal firepower. The new names behind this bid are businessman Laurence Lekalake, Tati West MP, Charles Tibone and lawyer Parks Tafa. The other development is that for this particular application, the adjudication proceedings are being chaired by an outsider (former cabinet minister and a group manager at Debswana Mining Company, Boyce Sebetela) who has never dealt with this matter before.

The first attempt to stack chips up on tables and assemble a fruit-machine choir at Masa was in 2010 when the Casino Control Board (precursor to the present-day Gambling Authority) awarded a licence to a company called Workman Holdings. The latter was made up of Gold Reef Resorts of South Africa, Aspera Holdings of Italy and a local, Moitsheki Lekalake. However, the High Court later revoked the licence following an application by Gaborone Sun International, Peermont Global at Grand Palm Hotel and Moonlight Casino at Gaborone Hotel who already operate casinos in the city. The argument that these three companies have made all along is that Gaborone’s casino market is already saturated.

After an interval, the partners in the project restarted the process when they changed the company name from Workman Holdings to Sealema Holdings. When the latter applied for a licence, the Casino Control Board initially ruled that the change of name necessitated the restarting of the quite tortuous application process. Unhappy with this decision, the company appealed to the Minister of Trade and Industry, Dorcas Makgato-Malesu, who agreed with its position that starting the process over would, in the language of documents that Botswana Guardian has had access to, be “unjustified”. She directed that the Board deal with Sealema’s application as submitted. The partners invoked a provision in the Companies Act (Section 34:5) which they interpreted to mean that a fresh application was not necessary in their particular case. In 2012, the Board resolved to issue a licence to Sealema subject to certain conditions being met. However, the licence was never issued because such conditions were not met.

The third attempt to get the licence is through a company called Indol whose directors are Guido Giachetti, Laurence Lekalake, Tibone and Tafa. Moitsheki Lekalake is the alternate director to Laurence Lekalake and Giachetti is the sole shareholder of Aspera Holdings. Once more, Gaborone Sun, Grand Palm and Gaborone Hotel have objected to the application, advancing a long list of reasons why Indol should not get the licence. The main one is that Indol is a mere reincarnation of Workman Holdings/Sealema. The counterargument by the applicant is that this is “a fresh independent application which ought to be considered based upon its own merit and without regard to any prior application.”

In terms of the Casino Act, someone granted a licence to operate a casino must satisfy the Gambling Authority that they will occupy the whole of the casino “with such security of tenure as the Board may deem adequate, and that he intends to manage the operation of the whole of the facilities of the casino.” In terms of the Indol shareholders’ agreement, Tsogo Sun (previously known as Gold Reef Resorts), will assist with daily management and administration. In its objection, Gaborone Sun interprets this to mean that on its own, Indol lacks the expertise to handle the day-to-day running of the Masa casino and has thus outsourced such function to Tsogo Sun. 

In its defence, Indol says that the Act does not preclude an operator from subcontracting out certain functions and notes further that it would be absurd to interpret “manage the whole operation” to be a prohibition on outsourcing: “All companies act through natural persons whose services they acquire by contract.” The company also states that Tsogo Sun is the largest casino operator in Africa and will bring a wealth of experience and expertise to the project.

To Peermont Global’s objection that Indol misstated fact when it claimed that it has “the highest real citizen participation” in the casino project, the rebuttal is that the former is itself misquoting a statement that the casino will have “one of the highest citizen participation” rates in Botswana.

Some five or so roulette-table dice throws away from Masa Centre is Gaborone Hotel which has been running an everyman operation called Moonlight Casino. In its objection, the latter says that its business would suffer on account of both this proximity and having to compete against a huge operation like Tsogo Sun. Indol denies with a very telling rebuttal: “The applicant will not be in competition with Moonlight. The applicant will offer an exclusive gambling experience to punters at the ‘top-end’ of the gambling market. This is clearly distinct from the service offered by Moonlight.”

This is not the first time that Indol has been mentioned with regard to this application. From the Casino Control Board’s assessment of Workman Holdings application, the shareholding figures didn’t exactly tell the real story. Gold Reef Resort stake was 50 percent while the remainder was evenly split between Aspera and Moitsheki Lekalake. However, the calculations of the Board’s secretariat showed that 97 percent of actual participation in the venture would be by foreigners and only 3 percent by Lekalake. Initially, the Board rejected the application and insisted that shareholding in the proposed venture be 100 percent citizen-owned. 

In order to satisfy that condition, Workman Holdings proposed (through a letter to the Board) that a new company it was forming, Indol (Pty) LTD, would lease out all assets and that either Gold Reef Resort or Workman Holdings itself would second staff. However, there was a feeling within the Board that this arrangement would basically amount to fronting.

Last modified on Monday, 04 August 2014 08:58

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