13/01/2022 - 08:56

Blackstone offer may seal Crown takeover

13/01/2022 - 08:56

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US-based private equity group Blackstone has increased its bid for Crown Resorts for a fourth time and on this occasion the casino operator has signalled it will likely support the takeover.

Blackstone offer may seal Crown takeover

US-based private equity group Blackstone has increased its bid for Crown Resorts for a fourth time and on this occasion the casino operator has signalled it will likely support the takeover.

Blackstone raised its bid by 60 cents to $13.10 per share, which equates to an $8.87 billion proposal.

Its initial proposal in March was pitched at $11.85 per share; it subsequently lifted its offer to $12.35 and $12.50.

Crown said today it was in shareholders' interests to discuss the offer further and the company will encourage Blackstone to make a binding bid.

If Blackstone makes a binding offer of the same value or more, Crown said its board would unanimously recommend investors accept.

Blackstone increased its offer after considering non-public information provided by Crown during initial due diligence.

James Packer's Consolidated Press Holdings is Crown's biggest shareholder and has a 36.8 per cent stake.

Blackstone already has a stake of almost 10 per cent, which it bought last year.

Any deal would require approval from a number of groups. These include a third-party expert assessing the proposal on behalf of investors, and casino regulators in Victoria, NSW and Western Australia.

The bid comes in the midst of the Perth Casino Royal Commission, which is due to hold its final hearings in February and hand its final report to the WA government in March.

The commission follows similar inquiries in NSW and Victoria, which were highly critical of Crown's failure to block dealings with organised crime groups or halt money laundering through its casinos.

The inquiries have also revealed lax regulation of Crown's casinos.

The NSW inquiry found Crown was an unsuitable party to hold a casino licence in that state, and as a result its newly-built Barangaroo casino has not opened.

The Victorian inquiry recommended tougher regulatory scrutiny of Crown and gave the company two years to improve its governance and regulation. 

Blackstone is a private investment group with more than $US700 billion in funds under advice, spread across real estate, private equity, hedge funds and credit markets.

It has multiple investments in the gambling sector in the United States and Latin America, including ownership of several major gambling resorts in Las Vegas.

Crown shares on the ASX closed 8.7 per cent higher today $12.65, valuing the company at $7.7 billion. 

 

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