Packer’s Crown Resorts receives US $6.2bn buyout offer from Blackstone

REUTERS: Beleaguered casino operator Crown Resorts Ltd said on Monday it received a buyout offer from private equity company Blackstone Group Inc that values the company at A$8.02 billion (US $6.19 billion).

The offer was priced at A$11.85 per share, a premium of 20.2 percent to Crown’s closing price of A$9.86 on Friday.

Blackstone currently has a 10% stake in Crown which it bought from Macau’s Melco Resorts & Entertainment Ltd in April last year, making it the second-largest holder in Crown after the company’s billionaire founder James Packer.

Crown said its board had not yet formed a view on the offer and said it would now begin its assessment, urging shareholders to take no action at this stage.

Blackstone’s bid comes at a time when the casino operator has seen a string of top executives exit recently after an inquiry accused it of widespread money laundering and governance issues.

Crown said the offer was subject to many conditions, including due diligence, arranging debt finance and Blackstone receiving approvals from gambling regulators that it would be allowed continue to own and operate the Sydney, Melbourne & Perth licences.

Three Australian states have either held or said they would hold inquiries into Crown since Australian media reports accused the company of doing business with tour operators with ties to organised crime.

The company’s earnings have also come under sharp pressure as intermittent COVID-19 lockdowns hurt its operations, leading to it posting its first half-year loss in over a decade in February.

Shares of the company have risen about 2.4 percent so far this year, after a near 20 percent plunge in 2020.

James Packer as the single largest shareholder owns 36.8 percent of Crown Resorts.