James Packer in $1.35bn Melco Crown Entertainment sellout

James Packer in $1.35bn Melco Crown Entertainment sellout - 9th May 2017

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James Packer with Lawrence Ho, chief executive Melco Crown, at the opening of Melco’s Studio City resort in Macau in 2015.

by Damon Kitney

James Packer’s Crown Resorts has reaped a further $US1 billion ($1.35bn) after selling its entire holding in Asian gaming company Melco Crown Entertainment, formally ending a 12-year partnership with Chinese gaming tsar Lawrence Ho.

Mr Ho’s Melco International Development last night confirmed the purchase of Crown Resorts’ remaining 11.2 per cent stake in Melco Crown, which will deliver Crown proceeds of $US987 million.

In an update to the market this morning, Crown (CWN) revealed that the proceeds of the sale will be used to reduce debt. Crown also noted that its former chairman Robert Rankin will resign as a non-executive director of Melco Resorts.

It is believe Crown took advantage of the share trading window that followed Melco Crown’s latest quarterly results, which were released last week. It was the first deal executed by Crown’s new general counsel and company secretary Mary Manos.

As part of the sale, Crown has also severed its joint venture arrangements with Melco Crown for the development of new ­casino resorts in Japan, leaving both parties to go it alone with future projects in a market many believe could be the next gaming Mecca globally.

However, it is understood that pushing ahead with new developments in Japan is currently not a No 1 priority for Crown despite the Japanese government in December legalising gambling. Legislation allowing the establishment of new casinos is expected to pass parliament later this year.

“Despite our positive history with Crown, I made the strategic decision to terminate the joint venture arrangement and allow Melco to pursue Japan alone,” Mr Ho said last night.

The sale of Crown’s holding comes weeks after Mr Packer sold his investment in Hollywood movie financing business RatPac Entertainment as the billionaire strives to make his private company debt free.

(The Australian)