The planned acquisition of Crown Resorts by US private equity firm The Blackstone Group has passed its first hurdle with the Australian government’s Foreign Investment Review Board (FIRB) offering its approval.
Crown said via a Tuesday filing that Blackstone has now received written confirmation from the FIRB that the government has no objection to Blackstone’s proposed acquisition of the Australian casino giant.
The approval satisfies a key clause of a Scheme Implementation Deed between the two companies and released to the ASX in February, although the takeover still requires approval by relevant state regulators and company shareholders.
As previously reported by Inside Asian Gaming, Crown has agreed to a sale all of its shares to Blackstone for AU$8.9 billion (US$6.5 billion), equivalent to AU$13.10 per share.
Crown Chairman Ziggy Switkowski described the deal at the time as “an attractive outcome for shareholders” given the recent regulatory setbacks the company has faced.
“The all-cash offer provides shareholders with certainty of value,” he said. Blackstone’s final proposal was its fourth such attempt to takeover Crown, having launched an initial bid of AU$11.85 per share early last year and an AU$12.35 per share offer soon after. Crown knocked back those offers in May, claiming they undervalued the company’s assets and future earnings power.
Blackstone already holds a 9.99% stake in Crown which it acquired from Melco Resorts & Entertainment in April 2020. Melco had purchased the 9.99% stake from James Packer’s Consolidated Press Holdings a year earlier but backed out of a deal to purchase a second tranche after regulators in New South Wales launched an independent inquiry, which in February 2021 ultimately led to the NSW regulator finding Crown unsuitable to hold a NSW casino license.
Blackstone was one of two major international investment groups to express an interest in Crown in 2021, the other being Oaktree Capital Management, while rival casino operator Star Entertainment Group withdrew a merger proposal in July.
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