illionaire James Packer has sold almost half of his stake in casino operator Crown Resorts for about AUD 1.76 billion (USD 1.21 B). The billionaire's private investment vehicle Consolidated Press Holdings on Thursday night said it had sold about half its shares in Crown to Melco Resorts & Entertainment. Melco owns casinos in Macau and formerly had a joint venture with Crown in the Chinese gambling hub.
Packer, who had held 46 percent stake in Crown, said the company would remain a massive part of his life. "My continuing Crown shareholding represents my single largest investment," he said in a statement released late on Thursday night. "I am still vitally interested in Crown’s success as a world-class resort and gaming business."
The sale of a 19.99 percent of Packer's shares leaves him with about a quarter of the company (26%), worth about $2.3 billion (USD 1.5 B), and remain on the board.
Speculation of a potential sale of Packer's shareholding has been rising in recent weeks after news broke that Crown had been engaged in discussions for a $10 billion cash-and-stock buyout with Las Vegas casino operator Wynn Resorts before the negotiations abruptly collapsed in April. Packer agreed to sell his stake at AUD 13.00 per share, significantly lower than the AUD 14.75 offered by Wynn.
Sources close to the Crown board on Thursday night said they had not been aware of Packer's plan to sell shares to Melco, but were not surprised at the news given his consideration of a sale to Wynn, according to The Sydney Morning Herald.
Melco, which is purchasing the shares from CPH, is run by Lawrence Ho, son of the gambling tycoon Stanley Ho who once enjoyed a monopoly on gambling in Macau. For 12 years from 2004 Crown was in a joint venture with Melco before ending the partnership in 2016 after Crown executives were detained in China. During that time the companies operated the City of Dreams and Melco Crown resorts in Macau.
"I am thrilled Lawrence Ho and Melco have chosen to invest in Crown," Packer said. Ho said the two companies shared similar DNA and expressed confidence in Crown's Barangaroo development in Sydney, to open next year. "Crown's resorts in Perth and Melbourne are world class entertainment destinations and I believe that Crown Sydney, much like Melco's Morpheus property, will create an architectural icon for the city, the country and the world," Ho said.
Melco said it intended to pursue representation on Crown's board once it obtains approval from gaming regulatory authorities across Australia. The company also signalled it would be willing to increase its stake in Crown. "Additionally, subject to obtaining requisite regulatory approvals, Melco welcomes the opportunity to increase its ownership in Crown," Melco said in a statement to the Nasdaq stock exchange.