After seeing 18 of its representatives arrested in China over the weekend, Australian casino operator Crown Resorts Limited has now reportedly confirmed previous speculation that it intends to offload some more of its international holdings.
According to a report from GGRAsia citing a Thursday filing to the Australian Securities Exchange, Melbourne-based Crown Resorts Limited explained that the process will additionally see it conduct an initial public offering (IPO) on a 49% interest in some of its domestic hotels business.
“Work on the proposed de-merger, in particular to obtain all the necessary approvals, consents and waivers from third parties including from governments and gaming regulators, is ongoing,” read the Sydney filing from Crown Resorts Limited, in which entrepreneur James Packer serves as the major shareholder.
Through its Crown Asia Investments Party Limited subsidiary, Crown Resorts Limited had held a 34.3% stake in Asian casino developer Melco Crown Entertainment Limited, which is at least partially responsible for the City Of Dreams Manila development in the Philippines alongside the City Of Dreams Casino, Altira Macau and Studio City Casino Macau properties in the Chinese city of Macau, but revealed in May that it had cut this interest to 27.4%.
Crown Resorts Limited is holding its annual general meeting in Perth this week and first revealed that it was considering a further partition of its non-Australia business along with the domestic IPO move in June. GGRAsia reported that the IPO is “likely to include” the operator’s two hotels in Melbourne as well as a pair of enterprises in Western Australia.
“Following a detailed evaluation, the Crown Resorts Limited board has now endorsed the implementation of a potential IPO of a 49% interest in some of its Australian hotels and associated retail property, which are likely to include the Crown Promenade hotels in Melbourne and Perth and the Crown Metropol hotels in Melbourne and Perth,” read the filing from Crown Resorts Limited. “If implemented, the IPO could realise significant value for Crown Resorts Limited shareholders while providing the ability to maintain a majority interest in key assets within the Australian business. Such an IPO would support Crown Resorts Limited’s ongoing capital management strategy and allow Crown Resorts Limited to maintain a strong balance sheet and credit profile to fund existing development projects.”
The weekend arrests in Shanghai included Jason O’Connor, VIP International Executive General Manager for Crown Resorts Limited, and led to the value of the firm’s shares falling by a record 14% before a Tuesday rally saw them recover slightly to stand at $8.66 each.