The market now knows James Packer is a willing seller.Credit:Bloomberg
Wynn and Crown,and probably more particularly Wynn and James Packer,had clearly had confidential conversations over the weeks and months leading up to Tuesday’s confirmation by Crown of reports of the deal. The fact that Crown implied there had been a proposal at a lower price than the $14.75 a share cash and scrip offer it outlined on Tuesday supports that conclusion.
Presumably Wynn had hoped to lock down the final price and terms of an agreed deal – it had to be agreed because Wynn wanted to execute it via a scheme of arrangement – before it was announced to the market,its shareholders and its regulators.
Instead,the leak – which interacted with the ASX’s continuous disclosure regime to force Crown to disclose the fact of the proposal and the outline of its terms - meant it had an incomplete deal,with no certainty as to final price or terms or,indeed,success.
There was nothing concrete Wynn could tell the market,or its regulators,about a proposal to spend $10 billion on a company they would know little,if anything,about and in a jurisdiction they would be unfamiliar with. There was also the potential that the early disclosure of its interest would either flush out competition or give Crown’s board more leverage to extract a higher price.
The timing of the disclosure couldn’t have come at a more sensitive moment for Wynn.
Wynn's $US2.6 billion Encore Boston Harbor casino complex is scheduled to open in June but its licence is under threat.Credit:AP
Last week gaming regulators in Massachusetts held a hearing to determine whether Wynn was a suitable company to hold a gaming licence in the state. Wynn has been building a $US2.6 billion casino and resort complex in Boston. Encore Boston Harbor is scheduled to open in June.
The hearing relates to the multiple allegations of extremely serious sexual misconduct against the company’s founder,Steve Wynn,and allegations that the group’s senior executives oversaw very sophisticated cover-ups,over years,of expensive settlements with half a dozen or so female employees.