Las Vegas casino landlord buying Australia’s Crown Resorts
A major casino landlord in Las Vegas is set to acquire Australia’s Crown Resorts, whose largest shareholder ventured to America’s gambling capital over the years for several big deals.
Crown announced Monday that it reached a deal for financial conglomerate Blackstone to acquire the company for AU$13.10 per share in cash, valuing the casino operator at about AU$8.9 billion, up more than AU$845 million from Blackstone’s initial offer nearly a year ago.
The buyout values Crown at about US$6.4 billion, according to currency converter xe.com.
Blackstone has a heavy presence on Las Vegas Boulevard, having acquired several hotels, including Bellagio, for billions of dollars over the past several years.
Crown’s largest shareholder, Australian billionaire James Packer, controlled 36.8 percent of its stock as of last summer, the company reported.
All told, the buyout “represents an attractive outcome for shareholders,” Crown Chairman Ziggy Switkowski said in a news release.
“The agreement with Blackstone also highlights the strength of the Crown brand and confidence in our future as we emerge from some challenging times, which is welcome news for our people, customers and stakeholders,” Crown CEO Steve McCann said in the release.
Blackstone had already embarked on a real estate buying spree in Southern Nevada when it purchased The Cosmopolitan of Las Vegas in 2014 for $1.73 billion. It then bought Bellagio in 2019 for about $4.2 billion from MGM Resorts International and leased it back to the casino giant.
Blackstone also partnered with MGM’s real estate spinoff on a $4.6 billion deal in early 2020 to acquire MGM Grand and Mandalay Bay and lease them back to MGM Resorts.
Last year, it also bought the Aria and Vdara hotels for nearly $3.9 billion from MGM Resorts and leased them back, and announced it was selling the Cosmopolitan for $5.65 billion.
Meanwhile, Packer’s latest attempt to gain a foothold on the Strip was with the never-built Alon Las Vegas project.
He acquired the vacant former New Frontier site through foreclosure in 2014 and set out to build an 1,100-room hotel-casino. But Packer reportedly had trouble raising project funds, and Crown bailed on the development in late 2016.
A year later, Wynn Resorts announced it was acquiring the Alon site and some adjacent property — about 38 acres total — for $336 million.
Long before Alon fizzled, Packer teamed with Texas developer Chris Milam in 2007 on plans for a 142-story casino-resort on the former Wet ’n’ Wild water park site on the north Strip.
That same year, Packer also put $250 million into the company developing the towering Fontainebleau next door for a nearly 20 percent ownership stake.
However, Las Vegas’ frenzied real estate bubble soon burst, the economy tanked, and Packer’s plans, like those of countless others in the valley at the time, got derailed.
The skyscraper with Milam, Crown Las Vegas, was never built, and the unfinished Fontainebleau went bankrupt in 2009. (The Fontainebleau’s original developer, Jeffrey Soffer, reacquired the still-unfinished project in early 2021, after it changed hands a couple of times over the years, and aims to open the 67-story hotel-casino in late 2023.)
Crown also reached a $1.75 billion deal in 2007 to buy the company that owned Las Vegas’ Cannery casinos. The sale fell apart in 2009, though Crown invested in the company.
Blackstone wasn’t the first company with a big presence on the Strip to set its sights on Crown.
In spring 2019, more than a year after it bought Crown’s land on Las Vegas Boulevard, Wynn Resorts called off a possible deal to acquire the company.
Contact Eli Segall at esegall@reviewjournal.com or 702-383-0342. Follow @eli_segall on Twitter.