Fri, Oct 21, 11:16am by Staff Writer
One of the richest businessmen in Australia, James Packer reportedly has plans to offer a minority stake in some of Crown Resorts’ hotels and retail properties as his casino empire goes into damage control.
The retail and hotel properties that are up for grabs are likely to include the Crown Promenade hotels in Melbourne and Perth, plus the Crown Metropol hotels in Melbourne and Perth. If it materializes, the potential initial public offering would be a 49 per cent stake.
“If implemented, the IPO could realise significant value for Crown Resorts shareholders, while providing the ability to maintain a majority interest in key assets within the Australian business,” the company said in a statement to the ASX.
Crown Resorts is undergoing major structural changes, with the Australian and overseas businesses in the process of separating.
This latest move will separate the hospitality and gambling aspects of the business as well, further fragmenting the Crown brand.
This news comes in the same week as 18 Crown Resorts’ employees were detained in China over alleged ‘gambling’ offences. The Chinese government’s crackdown has the potential to put the company’s expansion plans at risk.
Shares in the company, which is one of Australia’s largest gaming and entertainment groups, nosedived on the news of the arrests this week, losing more than 10 per cent of their value. Shareholders grilled management at Crown’s annual meeting in Perth on Thursday morning.
The Chinese government have reportedly seized laptops that contain a database of so-called “whales”, the megarich Chinese customers who travel to Australia gamble in high-roller rooms at our casinos.
The crackdown could put Packer’s ambitious new $2 billion casino at Sydney’s Barangaroo at risk, as the project relies heavily on Chinese patronage. The penalty for soliciting high-rollers to gamble at overseas casinos, is up to 10 years in prison.
Betting, except on state lotteries, is illegal in mainland China.
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