The Star owns casinos and hotels in Sydney (pictured),Brisbane and the Gold Coast.Credit:Louise Kennerley
Blackstone,which lobbed an $8 billion bid for Crown in March,raised its offer for the business on the weekend,while a third suitor,US investment fund Oaktree Capital,offered $3 billion for Mr Packer’s 37 per cent stake in the company last month.
The Star informed Crown on Sunday that it would publicly announce its non-binding,indicative proposal on Monday morning,according to sources aware of the offer who requested anonymity to discuss confidential matters.
The company believes that because of its long track record of operating casinos in Sydney,Brisbane and the Gold Coast,it can solve Crown’s regulatory woes faster than other bidders for the under-pressure company. In February,Crown was found unfit to operate its new casino at Sydney’s Barangaroo after evidence of money-laundering in its casinos and other probity failures emerged in the long-running Bergin inquiry.
Investors in both companies would be issued shares in a new combined entity worth about $12 billion that would remain listed on the ASX under the deal.
Crown has been blocked from opening the casino at its new property at Sydney’s Barangaroo over probity concerns.Credit:Peter Braig
The Star believes merging the two groups would deliver $150 million to $200 million in cost savings a year,which would translate to about $2 billion in equity value for shareholders in a combined group.
Based on that,the deal has an implied value of $14 a share for Crown shareholders,the sources say. Crown’s shares closed at $12.12 on Friday.