Crown-Star merger afoot?

HospITalITy and gambling company The Star Entertainment Group has proposed a merger with Crown Resorts Limited, saying the amalgamation would create “a national tourism and entertainment leader with a world-class portfolio of integrated resorts”.

The proposed $12 billion union would seek to engage investors on a sale and leaseback of the enlarged property portfolio, with The Star believing it can complete its necessary due diligence and agree to a binding merger and definitive debt financing over the course of the next two-to-three months.

Spanning seven properties in four states, the merger pits The Star against investment management company The Blackstone Group, which has bid $8 billion for Crown (TD 22 Mar) and this morning announced a higher offer for the group.

A Star-Crown merger would likely need approval from the Australian Competition and Consumer Commission, and The Star would need to be approved as a licence holder by gambling regulators in Victoria and Western Australia.

Regulators suspended Crown’s licence for its new Sydney casino in Feb (TD 16 Feb), and royal commissions into the company will begin in Western Australia today (TD 08 Mar) Victoria later in the week (TD 24 Feb).

Crown Resorts Limited also this morning announced the appointment of Lendlease Chief Steve McCann as CEO and MD.