The Federal Court has approved US private equity firm Blackstone's $8.9 billion takeover of Crown Resorts, the Australian casino operator, in a decision handed down on Wednesday June 15, 20221. The deal is scheduled to be finalized on June 24, when the money between Blackstone and Crown changes hands1.
The acquisition will pay billionaire James Packer $3.36 billion for his 37 percent stake in the company, which he has been involved with since 19991. Crown will become a private company and will no longer be required to the ASX1. The court ruling was the final hurdle in the approvals process, after Blackstone received the green light from the state governments of Western Australia, New South Wales and Victoria1. Crown shareholders also backed the deal after the board told investors it would be in their best interest1.
The takeover follows years of scandals at Crown, including the company being fined for illegally promoting gambling in China, where 14 staff were jailed, and several damaging inquiries which found the casino operator enabled money laundering and had links to criminal gangs1. COVID-19 lockdowns and border closures added to the company's woes, with profits and share price falling1. A previous attempt by Mr Packer to leave the company in 2019 was scuttled when the would-be buyer reneged in the face of controversy and details of the deal were leaked1. The New South Wales Bergin inquiry, which found Crown was not fit to hold a casino license, was catalysed by Mr Packer's political dealings and his relationship with Chinese businessman Laurence Ho in his bid to build a casino at Sydney's Barangaroo1.
Blackstone is the world's second-biggest private equity fund1. It owns the MGM Grand, Mandalay Bay and Bellagio hotels and casinos in Las Vegas, and its real estate arm acquired the Bellagio Hotel in Las Vegas in 20191. It also owns Spanish company Cirsa, which operates 147 casinos in Spain, Italy and Latin America1.
State regulators have said Crown will be subject to strict conditions1.
What it means for players
Crown's $2.2 billion Sydney casino at Barangaroo has been banned from taking bets since it opened in 2020, and the takeover paves the way for that situation to change1. State regulators have said Crown will be subject to strict conditions, though the sources do not specify what those conditions are1. For players in Australia, the ownership change does not by itself alter licensing rules, which remain with state regulators. The sources do not report any change to entry requirements, game rules or operating hours at Crown's properties. Readers looking at how casino entry and play rules work across the region can see our guide to casinos and integrated resorts in Asia.
What happens next
The deal is scheduled to complete on June 24, 2022, when funds change hands between Blackstone and Crown1. After that, Crown becomes a private company and stops reporting to the ASX1. The sources do not report a date for any decision on lifting the betting ban at Barangaroo, or the terms of the strict conditions state regulators have said will apply1.