Crown Resorts (ASX:CWN) to assess the Oaktree Proposal

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Summary

  • Crown Resorts Limited (ASX:CWN) has received a proposal from Oaktree to provide a funding commitment for buy-back of Crown shares held by Consolidated Press Holdings.
  • The buy-back of Crown shares held by CPH would be subject to Crown shareholder approval.
  • The Crown Board will commence a process to assess the Oaktree Proposal.

Crown Resorts Limited (ASX:CWN) is amongst Australia’s biggest entertainment groups. It serves the economy through tourism, employment, training, and its corporate responsibility programs.

The Company has received an unsolicited, preliminary, non-binding and indicative proposal from a company on behalf of funds managed and advised by Oaktree Capital Management, L.P (Oaktree).

Meanwhile, CWN was trading up by 0.16% at AUD 11.94, at 10:43 AM AEST on 19 April 2021. Other consumer services stock in the green zone included Domino's Pizza Enterprises Limited (ASX:DMP), quoted AUD 107.34, up by 0.98%; Collins Foods Limited (ASX:CKF), up by 0.54%, trading at AUD 11.03, and Redcape Hotel Group (ASX:RDC), up by 1.57%, quoting AUD 0.97.

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The Oaktree Proposal

Oaktree has made an offer to provide a funding commitment of up to approximately AUD 3 billion to Crown. This has been proposed through a structured instrument.

The proceeds are intended to be used by Crown Resorts to buy-back some or all the Crown shares which are held by Consolidated Press Holdings Pty Limited (CPH) on a selective basis. It should be noted that CPH currently has a shareholding of almost 37% in Crown.

What’s next?

Any selective buy-back of Crown Resorts shares which are held by CPH would be subject to Crown shareholder approval. This also means that no votes will be cast in favour of the resolution by CPH or its associates.

As of now, the Crown Board has not formed a view on the merits of the Oaktree Proposal. It plans to commence a process to assess it.

The Company further notified that there was no certainty that the Oaktree Proposal would result in a transaction. Moreover, Crown shareholders are not required to take any action for now.

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

Blackstone acquisition progress

In March 2021, the Company had received a non-binding, unsolicited, indicative proposal for acquisition by The Blackstone Group and its affiliates.

Crown Resorts is still assessing the acquisition proposal, wherein Blackstone intends to acquire all the shares in Crown Resorts by the way of a scheme of arrangement.

The Regulatory Approval Condition has been recently modified. GET DETAILS HERE: Blackstone tweaks conditions for Crown Resorts acquisition proposal


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