Crown Resorts has agreed to enter into exclusive takeover talks with Blackstone Group after the US private equity group softened its offer to buy the under pressure Australian gaming company for around A$8.9 billion (6 .5 billion US dollars).
The revised offer values Crown at A$13.10 per share, up A$0.60 per share or around A$1 billion in additional cash from an earlier offer Blackstone made to the company. casino, backed by Australian billionaire James Packer, in November.
The latest offer comes after the gaming company’s board last year rejected several offers from the US takeover group, which already owns 9.99% of Crown.
Crown has since May been at the center of a bidding war between Blackstone and smaller casino rival Star Entertainment, which has been pursuing a merger.
Star withdrew interest in July when Australian authorities said Crown could potentially lose its gambling license following an investigation into money laundering charges. That threat was lifted in September after the investigation ended and Sydney-based Star continued to express interest in reviving its A$12 billion merger plan.
Blackstone will complete its due diligence in the next few days and if it decides to make a binding offer at no less than A$13.10 per share, the offer will be unanimously accepted by Crown’s board, the australian company said in a press release.
The deal highlights Blackstone’s continued interest in owning casinos as the private equity investor agreed in 2019 to acquire the property assets of the Bellagio Hotel and Casino in Las Vegas from MGM for $4. $25 billion.
Blackstone first approached Crown after Australian regulators ruled in early 2021 that the gaming company was not fit to operate a new AU$2.2 billion casino in Sydney due to concerns over the money laundering and poor corporate governance.
The deal also highlights the continued interest of global investors in seizing Australian assets despite the pandemic.
The Australian market has been one of the busiest for deals over the past year, driven by cheap funding and private capital targeting listed assets ranging from telecoms to airports to the funds themselves.