Crown Resorts ‘can absorb regulator fine’

Crown Resorts’ strong financial profile has helped it to weather the Covid crisis and still maintain a buffer that will allow it to absorb regulatory fines at its current rating level, Fitch said.

The credit ratings agency was writing a day after the Victorian Gambling and Casino Control Commission imposed an $80m fine on the operator over the illegal use of China UnionPay cards.

Crown warned that there may be further punitive actions to come from the VCGLR related to other findings from a recent Royal Commission inquiry that could carry penalties of up to $100m each.

It is also subject to another investigation from the Australian Transaction Reports and Analysis Centre over money-laundering breaches.

Fitch said Monday’s fine will increase Crown’s FFO adjusted net leverage by 0.2x to 0.4x, well below the 3x where the firm would take negative ratings action. The agency is more concerned about the group’s long-term capital structure after the takeover by Blackstone, it said.

Shareholders have voted in favour of an A$8.9bn (US$6.3bn) takeover offer from the US asset manager, although it has still not cleared Australian regulatory hurdles.

Source: Asia Gaming Brief