Blackstone buys A$552m stake in Australia's Crown Resorts; shares soar

[BENGALURU] Australia's Crown Resorts said on Wednesday that US private equity firm Blackstone Group had bought all of its shares held by Macau casino operator Melco Resorts & Entertainment, sending its share price soaring.

Crown said an entity controlled by Blackstone had bought about 67.7 million of its shares from Melco, which in February had shelved a bid to raise its holding in the Australian casino operator due to a drop in traveller numbers.

The shares were transferred at a price of A$8.15 each, putting the transaction value at A$551.6 million (S$509.1 million), and representing a discount of 5.2 per cent to the stock's last closing price.

The stake that changed hands represented about 9.99 per cent of the issued capital of Crown. Based on Refinitiv data as of Feb 6, the stake represents the entire holding of Melco's nominee.

Amid plunging traveller numbers due to curbs imposed to contain the new coronavirus, Melco scrapped its planned purchase of a second 9.99 per cent stake in Crown from billionaire James Packer, in a deal that had already raised regulatory concern.

Since then, Crown's shares have slipped about 28.1 per cent as of the last close, as Australia's travel curbs slammed casinos and kept away big-spending VIP Chinese tourists and even domestic players.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

Following the announcement, Crown's shares surged as much as 12.3 per cent to their highest level since March 6, against a 0.4 per cent gain on the benchmark ASX200 index by 0022 GMT.

REUTERS