Victoria and New South Wales approval for Crown Resorts Limited sale

In Australia and the move by American private equity management firm The Blackstone Group Incorporated to purchase Crown Resorts Limited has taken another step towards reality after being approved by gaming regulators for the states of Victoria and New South Wales.

According to a report from the Reuters news service, the around $6.35 billion arrangement was given the green light by the Foreign Investment Review Board in March a month after being signed off by the casino operator’s board of directors. The latest sanctions purportedly mean that the understanding now just needs the okay from authorities in Western Australia where Crown Resorts Limited is responsible for the 1,196-room Crown Perth property.

Preceding problems:

Crown Resorts Limited is moreover reportedly responsible for Victoria’s 1,600-room Crown Melbourne facility but was left reeling last year when the casino license for its new Crown Sydney development in New South Wales was rescinded. This move purportedly followed a state-run inquiry’s determination that the Sydney-listed operator may have been complicit in numerous instances of money laundering owing to its past use of foreign junket firms.

Clever capitalization:

This damning determination reportedly prompted New York-headquartered The Blackstone Group Incorporated to begin lodging a series of takeover proposals that culminated in a February deal that is to see it acquire all of Crown Resorts Limited’s issued shares at an individual price in the region of $9.35. The finalization of such an arrangement would purportedly give the buyer immediate control over a trio of Australian casinos as well as a large stake in the United Kingdom’s prestigious Crown London Aspinalls property.

Investor interest:

The Victorian Gambling and Casino Control Commission oversees Crown’s Resorts Limited’s flagship Crown Melbourne development and it reportedly disclosed that its approval was contingent upon the casino operator continuing to follow stock exchange governance rules. This determination purportedly pushed the Melbourne-headquartered casino company’s share price up by almost 2% earlier today to roughly $9.24, which bucked a 1.4% decline in the broader market.

Due diligence:

Philip Crawford serves as the Chair for the New South Wales Independent Liquor and Gaming Authority watchdog and he reportedly described the pair of approvals as ‘a key step’ in The Blackstone Group Incorporated’s plan to take over Crown Resorts Limited. The regulator purportedly moreover declared that his organization was intent on making sure the $1.56 billion Crown Sydney facility was ‘able to fully meet its undertakings for major operational, governance and structural reforms’ before granting its consent.

Reportedly read a statement from Crawford…

“The Blackstone Group Incorporated has been required to demonstrate the highest standards of probity. This commitment is vital to ensure Crown Sydney is free from criminal influence and properly manages the risks of harm associated with casino activities.”