Australia’s Crown Resorts exits Macau with US$1.16b Melco stake sale
Australia’s Crown Resorts has taken the final step of cutting its ties with Macau after Chinese authorities detained 18 of its employees last October for alleged “gambling crimes”.
The gaming giant, controlled by Australian tycoon James Packer, agreed to cash out of its remaining 11.2 per cent stake in Macau-focused Melco Crown Entertainment for US$1.16 billion.
It will also formally end its joint venture with Melco and its chief executive, billionaire tycoon Lawrence Ho.
The move came after the Australian gambling empire was targeted by Beijing in a crackdown that saw the detention of 18 Crown staff members in a string of raids in China seven months ago.
It also marks an end to Crown Resorts’ decade-long business adventure in Macau, the former Portuguese colony and now the world’s largest gambling hub.
“Upon completion of the repurchase agreement, Crown Resorts will no longer hold an interest in Melco Resorts,” Crown said in a statement.
Among the staff who were detained and are awaiting trial is Jason O’Connor, a specialist on Asian high-rollers and head of the casino group’s international VIP business.
Crown had been wooing Chinese gamblers to its resorts in Melbourne and Perth despite other foreign casino operators shunning China due to Beijing’s ongoing crackdown on corruption and money illicitly flowing overseas.
Under Chinese law each mainland citizen is entitled to take only 50,000 yuan (US$7,242) out of the country a year.
The net proceeds from the sales will “initially be used to reduce Crown Resorts’ net debt,” the company said. It added that it will now focus on its casinos and hotels in Melbourne and Perth, the development of the Queensbridge hotel tower in Melbourne, and its digital business.
Late last year, Crown sold a 13.4 per cent stake in Melco Crown to Ho’s Melco International.