Star Entertainment won’t match Blackstone’s Crown Resorts offer
The possibility of a merger between the two gaming giants now seems unlikely after Crown Resorts’ board backed the offer from private equity giant Blackstone.
Australia.- When Star Entertainment made an offer of AU$12bn (US$9.4bn) for Crown Resorts in May 2021, it raised the possibility of a merger between Australia’s two largest casino operators.
Star Entertainment Group later withdrew its offer due to uncertainty surrounding the future of Crown Resorts’ casino licence in Melbourne. But, since Victoria’s Royal Commission allowed Crown Resorts to keep the licence under stricter conditions, there’s been speculation about whether Star Entertainment Group could make another move.
However, that now seems impossible as Matt Bekier, Star’s CEO, has said the company does not plan to match an improved AUD8.9bn (US$6.36bn) offer from private equity group Blackstone, which has been unanimously approved by Crown Resorts.
Bekier confirmed that Star Entertainment was not prepared to pay such a high price for Crown Resorts’ assets, especially given the regulatory action against the operator and the lack of synergies.
Star Entertainment reports six-month net loss of US$53.2m
The impact of Covid-19 restrictions on Star Entertainment Group is apparent in the company’s latest financial report, which shows a net loss of AU$74m (US$53.2m) for the six months ending December 31.
Group-wide gross revenue fell 29 per cent year-on-year to AU$581m (US$418m) while EBITDA declined 87 per cent to AU$31m (US$22.3m).
As for VIP gaming, the report shows an 89 per cent decline to AU$1.8m (US$1.3m), while domestic gaming revenue fell 24.3 per cent to AU$498m (US$358.3m). There was a slight increase in non-gaming revenue to AU$8.5m (US$6.1m).
