- Us private equity group, Blackstone, has made a takeover offer of $8 billion
- Offer is worth $11.85 per share based on H1 results - a 19% premium
- Condition of offer includes having all three operator licenses
US private equity group Blackstone yesterday announced a takeover offer of $8 billion for Crown Resorts Limited (ASX:CWN).
The offer is worth $11.85 cash per share; a 19% premium to the average price of shares in Crown since their first-half results were released.
Blackstone, which is based in New York City, manages an asset profit of $800 billion and currently holds 10% of Crown after purchasing entertainment company Melco’s stake in April 2020.
Additionally, the private equity firm has been operating in Australia for 11 years through investing $14 billion across commercial and industrial real estate in Australia and New Zealand. Despite this significant investment, the firm only has about 30 local employees.
The offer – especially given the significant premium – has raised eyebrows, primarily due to regulatory issues Crown has been facing in recent times, notwithstanding the impact of the pandemic on the resort’s operations.
After numerous allegations, including money laundering, the operator was deemed not suitable to hold a licence for the new Barangaroo Casino in Sydney.
However, one of several conditions contained in the offer is that Crown must be considered a ‘suitable person’ to operate the three Casinos.
In a statement to the ASX, Crown said it has appointed UBS and Allens as financial and legal advisers respectively and has emphasised there is no certainty Blackstone’s offer will result in a transaction.
“The Crown Board has not yet formed a view on the merits of the Proposal.
“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.”
Crown Resorts, ASX Statement