The Blackstone Group Incorporated Upping Its Crown Resorts Limited Interest
The Blackstone Group Incorporated, an American private equity management firm, is reported to have increased its bid by another $300 million in order to take over the Australian casino operator Crown Resorts Limited.
A report from the Bloomberg news service claimed that the New York-headquartered investor had the earlier offer or roughly $6.2 billion rebuffed last month. However, it has now returned with a $6.5 billion offer. Should the offer be accepted, it would acquire the gambling giants’ issues shares at an individual price of $9.56.
Crown Resorts Limited is said to be responsible for both the gambling-friendly Crown Perth and Crown Melbourne facilities in Australia, as well as the United Kingdoms’ prestigious Crown London Aspinall’s property.
As of late, it has been reported that the Sydney-listed operator has been suffering after being refused a casino license for the new Crown Sydney venue owing to allegations that it could have potentially been complicit in a considerable amount of money laundering offences.
These offences were tied to its previous use of foreign junket enterprises.
Crown Resorts Limited has reportedly indicated that from now on, it intends to discuss the fresh offer with The Blackstone Group Incorporated as it is currently involved in implementing a wide-ranging corporate reform program. It could ultimately accept the advance.
This news has purportedly sent the casino operator’s share price up to 8.7% earlier this month to a 25-month high of roughly $9.22.
As of now, The Blackstone Group Incorporate is reported to already be the second-largest shareholder in Crown Resorts Limited. However, its current interest (9.99%), is dwarfed by the stake held by the Melbourne-headquartered operator’s founder, James Packer (73%).
The latest takeover offer would also have the added benefit of allowing this figure to make a clean exit from the company he led up until he stepped down in 2018 according to Bloomberg. Steve Johnson, Chief Investment Officer of Forager Funds Management, which holds shares in Crown Resorts Limited, reportedly told news services that the casino operator remains a very valuable and high-quality asset.
He also went on to say that it is destined to be worth more to private equity than it is ever going to be worth when listed.
Reports claim that Johnson also stated:
“The increase in offer price is a welcome step and we are supportive of the board continuing a push for an appropriate firm offer.”
Any buyout is said to potentially run into complications. This is because of the fact that it would need to be approved by the gaming regulators for the states of New South Wales, Victoria, and Western Australia before going ahead, according to Bloomberg.
At the end of the day, the ultimate prize would see The Blackstone Group Limited take complete control over a firm in two of Australia’s largest cities that have casino monopolies. This is in addition to an exquisite $1.6 billion development right on the Sydney waterfront.