Accor, the world's largest hotel and tourism services company, regards casinos as a strategic growth area offering real synergies with its tourism activities.  Accor currently manages nine casinos in France, with two further concessions in France recently awarded to the company.  Accor Casinos also runs the Dragonara Casino in Malta.

Accor Asia Pacific Chairman, David Baffsky, said Accor was delighted to be joining with such a well-established international group as Casinos Austria and looked forward to working with them on other hotel casino opportunities.

"Casinos Austria is very well established in the casino industry, represented in Australia, Europe, Africa, Middle East and the Americas.   We are confident that with Accor's expertise in hotel management and tourism services, the partnership has great potential for future development," said Mr Baffsky.

Mr Baffsky said that a significant change to the management of the Reef Casino complex would be the joint operation of the hotel and casino. Previously, the casino was managed by Casinos Austria, while the hotel was managed by a separate operator.

"The decision to jointly manage the hotel and casino will be of fundamental benefit to the future operation of the overall complex," said Mr Baffsky. "The two components are intrinsically linked in terms of their operation, and the integration of the complex's operations and marketing will help maximise revenue and profitability of the Resort as a whole."

Earlier this year, Casinos Austria AG announced that it would arrange for funding of approximately A$70 million into the Trust through the combination of a placement to Casinos Austria or its nominees of new units in the Trust, an underwritten rights issue by the Trust and a new debt facility.   The recapitalisation proposal is subject to approval from government bodies, ASX, ASIC, Foreign Investment Review Board and Unitholders of the Reef Casino Trust.

If approvals are granted, it is anticipated that the new joint venture will take over management of the complex from November.   It is Accor's intention to rebrand the hotel to its luxury Hotel Sofitel brand.

The Reef Hotel Casino opened in Cairns in January 1996.  The Casino has a total gaming floor of 7,000 square metres, with 45 gaming tables and 540 machines currently in operation.  The Casino provides a gaming room and Club Privé gaming room for high-stake players.

The 5-star hotel is Cairns' most prestigious hotel, with a total of 128 suites.  The complex also includes a function room for up to 250 delegates, three restaurants, business centre and leisure facilities.

Accor Managing Director for Australia/New Zealand and the South Pacific, Michael Issenberg, added:  "Accor brings to the Reef Casino and Hotel vast experience in tourism, being the largest hotel operator in Australia generally and Queensland specifically.  We also have a strong presence throughout Asia, the main inbound source area for the casino and hotel.

"We have demonstrated our ability to succeed in the Cairns market, which has been one of Australia's most challenging markets in recent years.  We currently have three hotels in the Cairns region - Novotel Palm Cove Resort, The Oasis Resort Cairns, and Mercure Harbourside - and recently both the Novotel and The Oasis received awards of excellence in the Tropical North Queensland tourism awards.  Novotel Palm Cove Resort was one of the outstanding performers in the four-star market during 1998.

"We believe that while the Cairns market has been under great pressure in recent years, particularly due to the Asian recession, there are positive signs of a revival.  Already there have been optimistic forecasts for modest improvements in many of the key Asian economies and the Australian domestic economy continues to grow strongly.  Tropical North Queensland offers some of the world's finest natural tourist attractions and with the Olympic year ahead of us, there will be significant increases in foreign visitors who will combine a visit to Cairns with their stay in Sydney.

"We also believe there is potential for growth in the conference and incentive markets, which will directly and indirectly benefit the hotel and casino, and moves by companies such as Chevron Oil to relocate their offices to Cairns will help strengthen the corporate travel base in the region.

"The rebranding of the hotel to Sofitel - one of the world's most distinctive luxury brands - will be a major asset for the Reef Casino Hotel, which will become part of a network of over 120 Sofitel hotels globally. The brand is represented in most of the major countries of the world, with the new flagship Sofitel Le Faubourg opening in Paris in May and new Sofitels under construction in cities such as New York, Chicago, London and Berlin."

Accor is the world's largest hotel and tourism company, with over 2,700 hotels, travel agencies, car rental, and other tourism services under its management.  Accor Asia Pacific is the largest hotel operator in the Asia Pacific region with 138 hotels, including 62 in Australia under the brands Sofitel, Novotel, Mercure and Ibis.