(Reuters) – The troubled Australian casino operator Crown Resorts Ltd said on Monday that it had received a conditional buyout offer from US private equity giant Blackstone, which sent its shares up 19%.
The indication of the proposal is that casinos and gaming operators around the world are seeing values decline as the coronavirus lockout has poor earnings, which puts them on the radar of listed investment firms.
Crown has suffered more than most after a year-long regulatory inquiry into allegations of money laundering and failures at the company, which last month lost its gambling license for its new $ 2.2 billion A casino in Sydney.
Since then, top executives, including his CEO, have resigned, paving the way for Crown to restore its reputation and regain its license with former Federal Communications Minister and Chairman Helen Coonan at the helm of the overhaul.
Crown said Blackstone’s proposal was A $ 11.85 per share, a premium of 20.2% on the company’s last closing price and valued at A $ 8.02 billion ($ 6.2 billion).
Shares rose to $ 11,750 following news of the proposal Monday, the highest in a year. The share fell by almost 20% in 2020 because the investigation exposed major mistakes in the management of the company.
Blackstone currently has a 10% stake in Crown which he bought from Macau’s Melco Resorts & Entertainment in April last year, at just $ 8.15 per share. He is the second largest holder after billionaire founder James Packer.
The company’s board has not yet commented on the offer, which was subject to conditions including the necessary prudence, the arrangement of debt financing and Blackstone receiving gambling approvals to operate Crown’s Sydney, Melbourne and Perth licenses, said the company in a statement.
Blackstone recently acquired the Bellagio in Las Vegas for $ 4.25 billion, and also owns a casino resort called ‘The Cosmopolitan’ in Las Vegas and the Spanish operating gaming hall operator Cirsa.
($ 1 = 1.2967 Australian dollars)
Reporting by Rashmi Ashok in Bengaluru; Edited by Diane Craft and Stephen Coates