The Blackstone Group reveals key modifications to Crown acquisition proposal

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Crown Melbourne

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American multinational private equity and hedge fund giant The Blackstone Group has outlined a series of modifications to the conditions surrounding its AU$8 billion proposal to acquire Australias Crown Resorts, demanding greater clarity around the regulatory approval process.

The modifications were revealed by Crown Resorts on Tuesday and relate to a previous condition that Blackstone receive regulatory confirmation that a Blackstone-owned Crown is a suitable person to continue to own and operate the casino licenses in Sydney, Melbourne and Perth.

Blackstone now wants such confirmation to go much further, including approval from each relevant regulatory authority to acquire 100% of the issued shares in Crown as required under the applicable casino legislation and framework agreements in each of their respective states.

It also sets out a new condition that neither of its licenses in Western Australia or Victoria are either cancelled, suspended, surrendered or threatened to be, or that the New South Wales regulator confirms or threatens to confirm a license will not be granted.

Likewise, Blackstone will withdraw its offer should any regulatory authority impose terms and conditions on the licenses or framework agreements which constitute a material adverse change (to the value of the license), and will walk away should any authority issue a recommendation for any of the above instances to take place.

According to Crown, Blackstone has now indicated that it expects to receive full probity approval by 3Q21 but that its proposal is not conditional on arranging debt financing.

As previously reported by Inside Asian Gaming, the Blackstone proposal, if accepted, would see it acquire all shares in Crown by way of a scheme of arrangement at an indicative price of AU$11.85 cash per share. Blackstone currently holds a 9.99% stake in Crown Resorts which itacquired from Melco Resorts & Entertainment in April 2020.

Crown said it continues to assess the proposal.