Australian casino company Star Entertainment Group on Monday proposed the acquisition of major shares of the opposition group Crown Resorts Ltd valued at A $ 9 billion ($ 7 billion), taking over two independent control giants of the troubled company .
Three months after it was announced that Crown did not qualify for a gambling license in its new Sydney building, Star said the stock exchange would create one of the largest and most attractive resorts in the Asia Pacific region.
The move gives crown shareholders a third option after the major acquisition company Blackstone Group (BX.N) previously raised its $ 8.4 billion bid, while Oaktree Capital Group (OAK_pa.N) recommended a refund for a refund. -A $ 3 billion crown founder pole, removes official concerns.
Star's approach shows great interest in Crown, which has highlighted tourism and property in Australia's four largest cities but its profitability and share price have been hit by the closure of coronavirus-related borders and regulatory woes.
If the deal goes ahead, Star has said it will boost the sale and repatriation of corporate property that includes several acres of land demanded by the water, creating a "significant value".
The shares of both companies hit their highest levels of the day before the epidemic, giving them a combined $ 13 billion in the middle of the session, as investors began to reap long-term benefits that Star built on their proposal.
Star's proposal is "co-operative, and the sale and re-renting provides the ability to repurchase to get the full value of both shares," said John Ayoub, portfolio manager for Wilson Asset Management which shares in both.
A February investigation found that Crown had illegally given money on its premises, knowing that he was dealing with tourist traffickers linked to organized crime and neglecting the safety of Chinese workers arrested in 2016 for violating gambling bans. It cited the influence of 37% founder and owner James Packer on the crown board as an administrative problem.
Crown, who lost the CEO during the investigation, said on Monday he had appointed Steve McCann, head of construction company Lendlease Group (LLC.AX), to take part. Crown said he was considering the Star's proposal, among others.
Following the investigation Packer drew his representatives to the Crown board and said he would relinquish the company's leadership for its future. Since returning to the company’s official operations years ago, Packer has repeatedly tried to sell down or get off his stake.
A Packer spokesman could not be reached for comment Monday.
'COLD'
While the Star proposal did not require approval from foreign regulators, as did Blackstone, it would attract the attention of dishonesty as it could create a single behemoth of gambling in Australia without a competitor.
When the New South Wales government approved the Sydney government in Sydney in 2013, it cited the need for Star competition as a reason.
A spokesman for the Australian Competition and Consumer Commission said Star had made a decision on its proposal but would "wait for the submission and start reviewing the public after that, if the matter continues".
Star chief executive Matt Bekier said there was little business exchange for the two companies, which would only compete in Sydney if Crown was allowed to run its own casino, and "would put these brands at the consumer's end, rather than allow both products to drag in the middle".
Unlike Star, which operates on popular gambling and entertainment machines, the Crown, which is not allowed to use slot machines in Sydney, has been suspended as a market participant, Bekier said.
"In a normal market, a combination of two to one would not be so easy to accept," said Yane Svetiev, a professor at the University of Sydney Law School who specializes in competition law.
"(But) I see someone arguing that maybe it's not so important because the market is already so regulated," he added.
A Star Star intraday price of A $ 4.30 could cost a crown purchase of A $ 7.8 billion. Crown stocks have given the market an A $ 8.8 billion market.
Representatives of Blackstone and Oaktree declined to comment.
($ 1 = 1,2739 Australian dollars)
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