{"id":29431,"date":"2021-03-23T07:33:11","date_gmt":"2021-03-23T15:33:11","guid":{"rendered":"https:\/\/www.lasvegasadvisor.com\/stiffs-and-georges\/?p=29431"},"modified":"2023-09-26T14:57:12","modified_gmt":"2023-09-26T22:57:12","slug":"packer-out-blackstone-in-at-crown","status":"publish","type":"post","link":"https:\/\/www.lasvegasadvisor.com\/blog\/packer-out-blackstone-in-at-crown\/","title":{"rendered":"Packer out, Blackstone in at Crown?"},"content":{"rendered":"\n
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Cosmopolitan of Las Vegas<\/strong> owner Blackstone Group<\/strong> threw a lifeline to troubled Crown Resorts<\/strong>, in the form of a $6.2 billion buyout offer. The rope comes with a substantial string attached<\/a>\u2014Australian regulators must preserve the (sleazy) Crown casino licenses. Without them, Crown isn’t worth that much, it seems. Heck, it’s not worth that much now: Blackstone’s offer was for $9.15\/share, which is 20% higher from the pittance where Crown is trading. The company has already lost its Sydney<\/strong> license, and its ones in Melbourne<\/strong> and Perth<\/strong> are under investigation. Blackstone is quite the high roller at the moment, having just plunked down $6 billion<\/a> for Extended Stay America<\/strong> (in tandem with Starwood Capital Group<\/strong>). In the meantime, Blackstone may not find it so easy to just demand three Australian casino licenses, given the depths of the problems at Crown, which has been found to have facilitated money laundering, among other sins.<\/p>\n\n\n\n\n\n\n\n

\u201cThat\u2019s a material risk to consider,\u201d academic Xinning Xiao<\/strong> told Bloomberg<\/em>. \u201cThe restructuring may take years.\u201d Wynn Resorts<\/strong> has already abandoned one Crown takeover deal and Melco Resorts & Entertainment<\/strong> skedaddled rather than submit itself to Ozzie scrutiny. That leaves Las Vegas Sands<\/strong>. It’s in an expansive mood regarding the Pacific Rim, has $6.25 billion thanks to its sale of Venelazzo<\/strong>, plus another $2.5 billion in the bank. It could outbid Blackstone easily if it so chose. And don’t let the $6.2 billion offer fool you: It’s a substantial discoun<\/a>t from where Crown was trading before ethical problems and Covid-19<\/strong> did a double whammy on its stock value. Blackstone saw a value proposition and stooped like a falcon. As portfolio manager Nathan Bell<\/strong> put it, \u201cBlackstone couldn\u2019t get away with a price like this if the casinos weren\u2019t being affected by Covid and the management issues at the same time.\u201d<\/p>\n\n\n\n

\u201cIt\u2019s only an opening bid,” Bell added. “It\u2019s a messy situation and offering to acquire a casino is a complex affair at the best of times due to all the regulation.\u201d Still, the already-rich James Packer<\/strong> would find himself $2.3 billion richer if he liquidated his 36% stake at Blackstone’s price. For the time being, he’s keeping mum about the whole affair. Meanwhile, we wait to see if Sands comes off the sidelines and makes this really<\/em> interesting.<\/p>\n\n\n\n