Australia’s Crown Resorts has revealed that it has received an AU$8 billion takeover offer from American multinational private equity and hedge fund giant The Blackstone Group.
According to a Monday morning ASX filing, the unsolicited, non-binding proposal was received over the weekend via an intermediary and, if accepted, would see The Blackstone Group acquire all shares in Crown by way of a scheme of arrangement at an indicative price of AU$11.85 cash per share.
Crown said the indicative price, which would be reduced by the value of any dividends or distributions declared or paid by Crown, “represents a premium of 19% to the volume-weighted average price of Crown shares since the release of its 1H FY21 results.”
The proposal values Crown at around AU$8 billion.
The Blackstone Group currently holds a 9.99% stake in Crown Resorts which it acquired from Melco Resorts & Entertainment in April 2020. Melco had purchased the 9.99% stake from James Packer’s Consolidated Press Holdings a year earlier but backed out of a deal to purchase a second tranche after regulators in New South Wales launched an independent inquiry.
The subsequent release of the Bergin Report following the conclusion of that inquiry saw Crown deemed unsuitable to hold a casino license for its AU$2.2 billion Crown Sydney development and prompted governments in Victoria and Western Australia – where Crown already operates casinos – to launch Royal Commissions.
Crown said Monday that The Blackstone Group’s proposal is subject to a number of conditions, including:
- due diligence
- arranging debt finance
- a unanimous Crown Board recommendation and a commitment from all Crown Directors to vote in favor of the Proposal
- execution of a binding Implementation Agreement including a condition that Blackstone receive regulatory confirmation that a Blackstone-owned Crown is a suitable person to continue to own and operate the Sydney, Melbourne & Perth licenses
- approval from Blackstone investment committees.
“The Crown Board has not yet formed a view on the merits of the Proposal,” Crown said Monday.
“It will now commence a process to assess the Proposal, having regard to the value and terms of the Proposal and other considerations. It will also engage with relevant stakeholders including regulatory authorities.”
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