Blackstone tweaks conditions for Crown Resorts acquisition proposal

Source: Jillian Cain Photography, Shutterstock

Summary

  • Crown Resorts Limited (ASX:CWN) is assessing an acquisition proposal, which it received from a company on behalf of funds managed and advised by The Blackstone Group Inc. and its affiliates.
  • Blackstone has recently written to Crown Resorts regarding a modification to the Regulatory Approval Condition.
  • By 3Q 2021, Blackstone expects to receive probity approval to acquire 100% of Crown Resorts.

In March 2021, Crown Resorts Limited (ASX:CWN) received an unsolicited, non-binding and indicative proposal for acquisition. A company on behalf of funds managed and advised by The Blackstone Group Inc. and its affiliates expressed interest in acquiring all the shares in Crown Resorts.

While Crown Resorts is still assessing the acquisition proposal, Blackstone has modified the Regulatory Approval Condition. Read on!

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Upon the release of this market update, CWN was trading up by 0.08 per cent at $12.10 in the early trading hours of 13 April 2021. Other consumer services stocks in the green zone were Tabcorp Holdings Limited (ASX:TAH) - up by 0.7 per cent at $4.95, The Star Entertainment Group Limited (ASX:SGR) - up by 0.5 per cent at $3.8 and Skycity Entertainment Group Limited (ASX:SKC) - up by 0.62 per cent at $3.20 - to name a few.

ALSO READ: Why Crown Resort & GrainCorp were in spotlight this week?

The Regulatory Approval Condition in Crown Resorts-Blackstone proposed deal

Blackstone wishes to acquire all the shares in Crown Resorts by way of a scheme of arrangement. The indicative price is $11.85 cash per share, that will be reduced by the value of any declared dividends/ distributions paid by Crown Resorts.

The proposal was subject to several conditions, including the execution of a binding Implementation Agreement. This would set out certain terms and conditions, one of which was that Blackstone receive regulatory confirmation that a Blackstone-owned Crown is suitable to continue to own and operate the Melbourne, Sydney, and Perth licences (along with other gaming-related approvals as required.

Modifications to The Regulatory Approval Condition

Blackstone has indicated that its proposal is not conditional on arranging debt financing. Besides, the Regulatory Approval Condition has been recently modified.

Way ahead

Blackstone expects to receive probity approval to acquire 100 per cent of Crown Resorts from each of the state gaming regulators by 3Q 2021. Meanwhile, the Crown Resorts Board is assessing the proposal, having regard to its value and terms, along with other considerations.

The Company has stated that currently, there is no certainty that the proposal will result in a transaction.

GOOD READ: Here’s how Crown (ASX:CWN) is embarking on reboot

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