Today, the US global asset management company Oaktree Capital Management modified the fundings of its takeover proposal to Crown Resorts. The proposal could be used to buy back shares of the Australian casino giant that are currently owned by billionaire James Packer.
Earlier this morning, Oaktree Capital announced that the newly proposed package consists of an AU$2-bilion loan and AU$1.1-billion convertible debt that could provide the US company with a stake of up to 9.99% in Crown Resorts. The updated offer is estimated roughly to AU$12.40 per share, which is slightly higher than the acquisition offers of both Blackstone and Star Entertainment. Both of these companies, however, are willing to take control of the entire company and may now feel forced to improve their offers, too.
As Casino Guardian previously reported, the Australian rival of Crown Resorts – Star Entertainment Group – had made an all-stock buyout of the company’s assets estimated at AU$9 billion, while Blackstone Group has already boosted its all-cash indicative offer to AU$8.4 billion. Under the terms of the aforementioned convertible loan offer, the number of new Crown Resorts shares to be issued to Oaktree Capital would be capped at up to a 10% stake.
Crown Resorts said that it had not made any decision on the proposal so far.
Controversial Figure of James Packer Puts Crown Resorts Under More Scrutiny and Criticism
The revised takeover bid of Oaktree Capital comes only a few weeks after Crown Resorts decided to reject an AU$12.35-a-share proposal from Blackstone Group. Another acquisition proposal – the one from Star Entertainment Group – is still being reviewed by the gambling operator. For the time being, the company has not formed an opinion on the specifics of the new offer of Oaktree and its shareholders are not required to take further action at this point.
Australian billionaire James Packer has been one of the central figures who faced most criticism in relation to Crown Resors’ operations. As a result of some findings of the company’s failures on a number of verticals, NSW gambling regulators decided that Crown Resorts was unsuitable to hold the operating permit for its new casino project in Sydney.
Regulatory bodies across the country have been citing the negative influence Mr Packer had on the group, saying it was at least partly the one to blame for alleged criminal activities, including money laundering. The billionaire investor in the casino giant has previously indicated that he is has been wanting to divest his holding in Crown Resorts.
As part of some recommendations made to the company, a report that was published earlier in 2021 suggested that the same standards of propriety and character applicable to the licence holder should also apply to anyone who holds a stake of more than 10% in the Australian gambling giant. However, being a match to those standards could be tough for Mr Packer who was found to have made what was described as a shameful and disgraceful threat to a businessman who suggested the possibility of privatisation of Crown Resorts.