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Aussie Billionaire James Packer’s Crown Resorts Gets $2.4 Billion Funding Offer From Oaktree Amid Regulatory Probe

Crown Resorts said Tuesday it had received a revised proposal from Oaktree Capital Group for the provision of A$3.1 billion ($2.4 billion) in funding to buyback the shares held by its controlling shareholder James Packer amid intensifying regulatory scrutiny down under.

Under the revised offer, Oaktree is proposing to use the funding to buy some or all of the Crown shares held by Packer’s Consolidated Press Holdings, Crown said in a statement to the Australian Stock Exchange. The funding comprised of a A$2 billion private term loan and a A$1.1 billion loan convertible into Crown shares at a strike price of A$13 apiece, it said. 

Crown, which is owned 37% by Consolidated Press, said its board has not yet formed a view on the merits of Oaktree’s revised proposal. Oaktree originally proposed a A$3 billion facility to buyback Crown shares.

“Crown shareholders do not need to take any action in relation to the revised Oaktree proposal at this stage,” Crown said in a statement. “There is no certainty that the revised Oaktree proposal will result in a transaction.”

Oaktree’s latest proposal comes a week after the Australian Transaction Reports and Analysis Centre (Austrac) widened anti-money laundering probes on casinos down under. Austrac, which has been looking into Crown’s Melbourne operations since last year, is also now investigating Crown Perth, Star Entertainment Group and Auckland-based SkyCity Entertainment Group, which operates a casino in Adelaide.

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Star, the only casino operator in Sydney, mounted a A$9.5 billion bid last month to merge with Crown that would create a A$12 billion casino giant.

Crown rejected the A$8.4 billion all-cash offer from Blackstone Group shortly after receiving the merger proposal made by Star.

Austrac said last week it has initiated formal investigations into potential breaches of anti-money laundering laws by Crown Perth. Regulators have been investigating Crown Melbourne since October 2020, while Crown Sydney’s gaming license was suspended in February this year.

Packer is the largest shareholder of Crown, which owns casinos in Australia and London, after taking over the empire of his late father, Kerry. He stepped down from the company’s board in March 2018 and resigned from the board of his family’s holding company Consolidated Press four months later. Packer, 53, is Australia’s 14th richest individual with a net worth of $3.6 billion, according to the World Billionaire’s List published in April.

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