Crown Resorts becomes $10b takeover target

Crown Resorts shares have soared after the casino operator confirmed talks with Wynn Resorts over a $10 billion cash-and-scrip takeover proposal by the Las Vegas gambling giant.

The James Packer-controlled gaming firm said Tuesday that, while the board had yet to consider Wynn’s proposal, it had an implied value of $14.75 per share.

That represents a 25.6 per cent premium to the stock’s $11.74 price before trade was paused ahead of the announcement.

The shares surged by as much as 22 per cent to $14.33 and were still more than 20 per cent higher at 1115 AEDT.

“The discussions between Crown and Wynn are at a preliminary stage and no agreement has been reached between the parties in relation to the structure, value or terms of a transaction,” Crown Resorts said in a statement to the ASX.

The proposal is 50-50 in cash and Wynn shares, with any offer subject to regulatory approval.

Crown, majority owned by Mr Packer’s Consolidated Press Holdings, has operations in Melbourne, Perth, and London, and has a luxury resort development in Sydney’s Barangaroo due to be completed in 2021.

The company has endured a turbulent three-year period in which it retreated from its expansion plans in Las Vegas and Macau, while 19 of its staff were arrested and jailed in 2017 for promoting gambling in China.

Mr Packer quit the Crown board in March 2018.

In February, the company reported a 26.7 per cent drop in first-half profit to $174.9 million.

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