Blackstone’s $8.9 Billion Crown Takeover Gains Watchdog Approval
The long-awaited Blackstone Group takeover of Crown Resorts looks set to go ahead after obtaining watchdog approval. The New South Wales Independent Liquor and Gaming Authority (ILGA) and the Victorian Gambling and Casino Control Commission (VGCCC) blessed the acquisition.
Blackstone having the required funds for the takeover was never an issue. The American investment giant manages $1.2 trillion worth of assets. However, it needed watchdog approval in order to gain a casino licence. It could not operate any of Crown’s casinos without such a licence.
The ILGA, a watchdog for New South Wales, explained checks took 15 months from the first time Blackstone inquired about the possibility of taking over Crown. The ILGA looked into Blackstone’s other casino company, Cirsa, in addition to Blackstone’s key personnel.
Watchdog Explains Part of the Vetting Process
Philip Crawford is the chairperson of the ILGA watchdog. He gave his comments via a statement on the ILGA website.
“The probity assessment has also resulted in certain persons being approved to become ‘close associates’ of Crown Sydney. These approvals are a step in the ILGA’s ongoing work to ensure Crown Sydney is able to fully meet its undertakings for major operational, governance, and structural reforms. ”
“As the prospective owner of Crown Resorts, Blackstone has been required to demonstrate the highest standards of probity as well as commitment to deliver the full suite of operational changes recommended by the Bergin Inquiry. This commitment is vital to ensure Crown Sydney is free from criminal influence and properly manages the risks of harm associated with casino activities.”
VGCCC Gives Its Approval
VGCCC, the other watchdog Blackstone needed to please, also gave the takeover the green light. The VGCCC oversees gambling in Victoria and, therefore, Melbourne. The regulator gave Blackstone a long list of legally enforceable conditions before giving its approval.
“Our approval comes with stringent conditions which balance delivering stronger controls on the casino and ensuring it continues to be the flagship casino in Australia. We will take action should any of these conditions not be met by either Blackstone or Crown.”
Crown Melbourne is under the gaze of an independent watchdog since it was deemed unsuitable to hold a Victorian casino licence. This remains the case until at least 2024.
Crown Goes on a Recruiting Spree
Crown’s board of directors believe the opening of the casino in Sydney is just around the corner. The lavish complex at Barangaroo cost $2.2 billion but is currently operating without its casino.
CEO Steve McCann revealed Crown is “very close” to finally opening its Sydney casino.
“We are very close to getting approval. But what I think is more important is that we can really assure the government, the regulators, but also the community in general that this will be the best gambling environment – certainly in the country – and probably in the world.”
Crown Resort placed several advertisements to fill vacancies at Crown Sydney as it anticipates a grand opening. Crown has 1,900 vacancies across Australia, with 500 at the Barangaroo casino.
Shareholders in Crown Resorts reactively positively to what is positive news. The share price advanced 1.96% to exactly $13 per share, which is a 52-week high.
Blackstone Group has remained tight-lipped throughout the acquisition process, and that remains the case. The Goliath equity firm has not acknowledged it has watchdog approval for the takeover. However, that will likely change now it has got the go-ahead to complete its purchase. Blackstone does not hang around when it comes to completing deals, which should not be any different. Expect Crown to have new owners in the coming weeks. All we need then is to learn Blackstone’s true intentions for the casino giant.
