Finance Finance News Las Vegas casino giant in talks to buy James Packer’s Crown Resorts

Las Vegas casino giant in talks to buy James Packer’s Crown Resorts

crown resort sydney barangaroo
An artist's impression of the $2.2 billion Crown Sydney Hotel Resort. Photo: Crown Resort
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Crown Resorts’ share price has surged after the company confirmed it is the subject of a $10 billion takeover offer from Las Vegas casino giant, Wynn Resorts.

Crown said in a statement that it was in discussions with Wynn about a “potential change of control transaction”.

Wynn has offered to acquire Crown at $14.75 per share — to be paid half in cash, and half in Wynn shares – which represents a 25.6 per cent premium on the share’s $11.74 price when trade was paused before the announcement.

The gaming firm, owned by billionaire James Packer, said on Tuesday that while the board had yet to consider the Wynn proposal, the offer had an implied value of $14.75 per share.

Mr Packer’s Consolidated Press owns 46.8 per cent of Crown.

The move is the latest in a period of restructuring by the gaming giant. In 2008, it sold land in Las Vegas slated for a large casino development, sold its 34 per cent stake in Macau’s Melco Resorts & Entertainment and its share of betting company CrownBet.

In recent months, Crown’s share price slipped as low as $11.74 on the back of lower gaming expectations, with the company reported in February a 26.7 per cent drop in first-half profit to $174.9 million.

Crown now has operations in Melbourne, Perth, and London and has a $2 billion luxury resort development in Sydney’s Barangaroo due to be completed in 2021.

Sharemarket commentator Stephen Mayne said the proposed sale was a “momentous day in the Packer family”.

“To sell out to a foreign rival, it’s a pretty dramatic withdrawal given his previous desire to be one of the world’s biggest gambling businesses,” Mr Mayne said.

“And the fact he is willing to walk away from the Barangaroo casino (one of NSW’s largest ever construction projects) before it’s even delivered, shows how much he wants out of this business.”

The Crown board has yet to consider the “preliminary” and “non-binding” offer from Wynn, which is subject to due diligence and approval from regulators.

It also stressed that “there is no certainty that these discussions will result in a transaction”.

“The discussions between Crown and Wynn are at a preliminary stage and no agreement has been reached between the parties in relation to the structure, value or terms of a transaction,” Crown Resorts said in a statement to the ASX.

-with AAP

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