(Reuters) – Troubled Australian casino operator Crown Resorts Ltd said on Monday it had received a conditional buyout from US private equity giant Blackstone, sending its shares 19% higher.
The indicative proposal comes at a time when casinos and gambling operators around the world have seen values plummet as coronavirus blockages make gains, putting them on the radar of cash-strapped investment firms.
Crown has suffered more than most after a one-year regulatory investigation has surfaced allegations of money laundering and governance failures at the company, leading to the loss of its gambling license for its new Sydney 2 casino. $ 2 billion last month.
Since then, top executives, including the chief executive, have resigned, paving the way for Crown to repair its reputation and regain its license, along with former federal communications minister and president Helen Coonan to lead the review.
Crown said Blackstone’s proposal was $ 11.85 a share, a 20.2% premium over the company’s last closing price, and valued it at $ 8.02 billion ($ 6.2 billion).
Its shares rose to US $ 11,750 following news of Monday’s proposal, the highest in the past year. Shares fell by almost 20% in 2020, as the investigation exposed major flaws in the company’s governance.
Blackstone currently owns a 10% stake in Crown, which it bought from Melco Resorts & Entertainment in Macau in April last year for just $ 8.15 per share and is the second largest holder after billionaire founder James Packer.
The company’s board has not yet expressed an opinion on the offer, which was subject to conditions such as due diligence, debt financing and Blackstone receiving gambling approvals to allow it to operate Sydney, Melbourne and Perth Crown licenses. the company said in a statement.
Blackstone recently acquired Bellagio in Las Vegas for $ 4.25 billion and also owns a casino resort called “Cosmopolitan” in Las Vegas and Spanish gaming room operator Cirsa.
($ 1 = $ 1.2967)
Rashmi Ashok’s report in Bengaluru; Editing by Diane Craft and Stephen Coates