Feb11
Wynn To Acquire Crown Resorts, Expected Value Of The Deal AU$10bn
April 13, 2019 Aleksandra Zolotic
Wynn Resorts, the industry’s magnate, is considering the acquisition of Crown Resorts, Australia’s casino giant. The proposed deal of quite a great financial value, AU$10bn, leads to Crown’s rapid surge in shares by no less than 22%. Though this may seem like a positive base for some conclusions…
…it’s too early to make any decisions, as it is still in the negotiating phase. Being at the preliminary stage, there is still no clear details regarding either the value or structure. As far as Crown is concerned, it’s not even definite whether the transaction will take place.
Waiting For Regulatory Approval
As mentioned, there is still no official announcement with more details of the alleged deal. Crown, owning venues across Melbourne, London and Perth are currently in the process of establishing an extra hub in Sydney. Commenting on the guesses whether the agreement is reality or not, Crown officials pointed out:
“The proposal is subject to a number of conditions including due diligence, Wynn obtaining all the necessary regulatory approvals and a recommendation by the Crown board. It is stated to be preliminary, confidential, non-binding and indicative. The Crown board has not yet considered the most recent proposal from Wynn.”
After all, Forbes awarded Wynn Macau 8 five stars, which certainly shows this titan is a desirable partner, at least when taking solely the business aspect into consideration.
Misdeeds From The Past
However, not every segment is as bright as the mentioned award. Though this potential acquisition should be the main focus, still both sides’ various controversies distract the community from it. To start with, there is the matter of Steve Wynn, who made headlines in the last year for sexual misconduct. This resulted in his resignation…
…as the group’s chairman and CEO. In addition to this, his stakes were sold. In addition to that, he had to pay a considerable penalty. Crown has also had a questionable reputation with 19 staff arrested in China for the unauthorized promotion of gambling. Sixteen of them were detained for 10 months each.
Wynn Involved In More Legal Issues
In addition to the affairs regarding Steve Wynn’s inappropriate behavior, there are more problems which led to battles in the court. By that, we mean the accusation of Genting for stolen design solutions. If the project is forced to stop, it could result in…
…major costs and a plethora of workers being laid off. However, the dispute seems to have had a positive outcome for both sides. The problematic design will be arranged in a way which wouldn’t endanger Wynn’s recognizable signature. The proposed changes should make sure each of the brands has a clearly distinctive design.
Source:
“Wynn in talks to acquire Packer’s Crown Resorts”, casinobeats.com, April 9, 2019.
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TBH, with such affairs, sometimes it’s hard to focus on the main point of the story, at least that’s how the majority of people think. Until more announcements come, it’s too early to form the opinion on the deal.