The US private equity group, Blackstone, has received permission to delve into the financial documents of Crown Resorts. This development follows Blackstone’s improved proposal last month, raising their bid to AU$8.5 billion (equivalent to US$6 billion) for the prominent Australian casino enterprise. It’s important to mention that Blackstone’s first overture was unsolicited – they presented an offer even though Crown wasn’t actively seeking a purchaser.
Although Crown is granting Blackstone access for a due diligence review (and welcoming other proposals as well), they are not overly enthusiastic about the present offer. They’ve publicly stated that it doesn’t accurately represent Crown’s actual value. Nevertheless, this presents Blackstone with an opportunity to enhance their bid and attempt to finalize the agreement.
Blackstone’s opening proposition of AU$11.85 per share was deemed insufficient, prompting a revised offer of AU$12.35. Ultimately, they settled on AU$12.50 per share, which persuaded Crown to permit an examination of their financial records.
Adding another layer to the situation, Crown’s principal shareholder, billionaire James Packer, has faced scrutiny from regulatory bodies for over a year. Despite this, prospective buyers such as Star Entertainment Group, a rival Australian firm, remain undeterred. After all, Crown still possesses valuable casino permits in two major Australian cities and even boasts a newly established resort in Sydney.
Crown has been in the spotlight for some time. They were given a two-year ultimatum in October to rectify their operations after an inquiry revealed questionable practices, including taking advantage of problem gamblers, evading taxes, and even facilitating money laundering.
The Australian gaming behemoth, Crown Resorts, is under fire in their home country. Allegations of unethical business dealings have led to questions about their suitability to manage their lavish new Sydney casino. As if that wasn’t enough, they’re also embroiled in a major inquiry over in Perth – it seems the house advantage isn’t always a sure thing.