Crown Resorts announced Monday morning that it has received a proposal from representatives of American global asset management firm Oaktree Capital Management L.P. to provide up to AU$3 billion for the purchase of Crown shares currently owned by James Packer.
According to an ASX filing by the Australian casino giant, the unsolicited, preliminary, non-binding and indicative proposal would see Oaktree provide up to AU$3 billion to Crown via a structured instrument, with the proceeds to be used by Crown to buy-back some or all of the Crown shares held by Packers Consolidated Press Holdings Pty Limited (CPH).
CPH is currently Crowns single largest shareholder with a 36.8% stake.
Crown said in its filing that the board has not yet formed a view on the merits of the proposal, and that any such buyback of CPH shares would be subject to shareholder approval with no vote cast by CPH itself.
News of the offer comes just days after CPH reached an agreement with the NSW Independent Liquor & Gaming Authority (ILGA) that would effectively ensure it remains distanced from the day to day business dealings of Crown.
The agreement is seen as a key step on Crowns long road back to suitability in NSW, where it is still waiting to open the casino at its AU$2.2 billion Crown Sydney development.
The influence of CPH and Packer on the Crown board was one of the key reasons Commissioner Patricia Bergin outlined in the recent Bergin Report for her recommendation that the company be found unsuitable to retain its state casino license.
Although she refrained from recommending Packer be required to sell down his stake in Crown Resorts, Commissioner Bergin made specific reference to his undue influence, writing, The Authority would need to be assured and be confident that there are no further arrangements that would facilitate a return to what was clearly a dysfunctional environment.