A gaming regulator has found Blackstone suitable for holding a casino license in both New South Wales and Victoria. [Image: Shutterstock.com]
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The Blackstone Group is close to acquiring Crown Resorts after regulators in Victoria and New South Wales (NSW) deemed the private equity firm suitable for a casino license. This means that Blackstone can own and operate the Crown Sydney and Crown Melbourne casinos upon completion of the acquisition.
Subject to extensive integrity evaluation
US-based Blackstone has undergone an extensive integrity assessment by NSW Independent Liquor & Gaming. According to Regulatory Authority Chairman Philip Crawford: “The probity assessment also led to some people agreeing to become ‘close partners’ of Crown Sydney.”
In addition to meeting integrity standards, Blackstone also demonstrated that it would fully implement the recommendations that came from the Bergen investigation. This is the investigation that initially deemed Crown unfit to obtain a Sydney casino license last year.
Last year, an independent investigation into Crown Resorts found the company unsuitable to obtain a casino license in Sydney due to its links to organized crime and money laundering.
He hasn’t opened his arena yet
Inquiry Commissioner Patricia Bergen outlined the important changes Crown Resorts will have to make to its corporate governance structure and culture before it can regain its Sydney license. The A$2.2 billion (US$1.6 billion) Crown Casino Resort Sydney has not opened its game room due to complications. However, it has opened its own restaurants and hotel.
Crown Melbourne is also subject to restrictions as a result of the failures, including delegated government oversight. The Victorian Gambling and Casino Control Commission has found Blackstone suitable to operate the casino, just weeks after issuing a record A$80 million (US$57 million) fine to Crown. The financial penalty relates to money laundering failures at Melbourne Stadium and violation of Chinese currency control laws.
Get the deal online
Blackstone is still waiting to hear the voice of the Western Australian games regulator before it begins its A$8.9 billion (US$6.4 billion) acquisition of Crown Resorts. Once that happens and the deal is approved by the Federal Court, Blackstone will then take Crown, which means it will no longer have a listing on the Australian Stock Exchange. Crown Resorts shareholders have already given their approval for the deal.
This isn’t Blackstone’s first foray into gambling. She already owns a number of hotels and casinos in Las Vegas, such as Bellagio, Mandalay Bay, and MGM Grand. She has also expressed interest in Latin American, Italian and Spanish casinos.
As part of the deal, billionaire James Packer, founder of Crown Resorts, will not act as a shareholder. He is set to receive A$3.26 billion (US$2.3 billion) for his 37% stake in the company.