Mon, Sep 16, 4:46pm by Staff Writer
Crown Resorts has been dealt another blow, with news that Melco Resorts & Entertainment has decided to put its purchase of a 20 per cent stake in Crown on hold for 60 days, pending the outcome of some of the regulatory investigations into Crown.
Casino Aus reports the original deal between Crown and Melco became public in June.
Melco, under the direction of chief executive officer Lawrence Ho planned to buy a 20 per cent stake in Crown from James Packer for A$1.76 billion.
The deal included the purchase of 135.35 million shares of Crown at A$13 per share.
Packer has long wanted to take some steps back from the business and focus on his mental health and personal life, the report reads.
Ho’s offer came in shortly after extensive talks between Crown and Wynn Resorts fell apart.
Wynn was looking to acquire Crown with a A$10 billion bid, but as soon as Crown made an announcement about the potential deal, Wynn pulled back and withdrew it altogether.
The two companies never resumed talks.
When Ho stepped up to the plate, Packer was more than ready to deal.
The initial intent to purchase was complete on June 6, but there was already a delay in the deal closing due to a New South Wales regulatory investigation.
That put the potential closing date out to the first week of September, tentatively.
The very mention of Lawrence Ho gaining a foothold in a major Australian business gave many regulators and lawmakers pause.
Lawrence’s father, Stanley Ho, was long suspected of doing business that involved connections to organised crime.
The Ho family has always denied the allegations.
Stanley Ho is the founder of a holdings company that owns nearly 20 casinos in Macau.
He also has investments across Asia and into Europe.
He owns businesses in the fields of real estate, air transportation, banking, tourism, shipping and entertainment.
He is believed to be worth several billion dollars.
Approaching 98 years of age later this year, Stanley Ho has been slowly passing his business dealings to his children, including Lawrence.
Allegations of criminal ties generally point to a Chinese triad named Kung Lo, which Ho reportedly financed and aided through his casinos and related junkets.
Some of the crimes include loan sharking, money laundering and involvement in the drug trade.
Even so, there has never been enough proof or strong evidence to tie Ho, unequivocally, to the triads.
— Financial Review (@FinancialReview) August 28, 2019
The two casino moguls have long been linked via business deals and attempts to work together.
Packer has known Stanley and Lawrence Ho for many years through the casino world.
But when the New South Wales Independent Liquor and Gaming Authority approved Crown for the Barangaroo project, Ho was excluded.
There was actually a provision in the agreement to prevent “any new business activities or transaction of a material nature between Stanley Huang Sun Ho or a Stanley Ho associated and Crown, any of Crown’s officers, directors or employees or any Crown subsidiary.
When the recent Melco purchase of Crown shares came to light, the New South Wales regulator immediately instigated an investigation.
The deal, it seemed, would be a clear violation of the Barangaroo agreement.
That investigation is pending.
While the Ho connections were the main reason that the Crown-Melco deal was under such scrutiny from the beginning, the tables have since turned.
Recently, a massive media investigation into Crown and its own links to organised crime resulted in a scathing report involving sex and drug trafficking and money laundering.
The casino’s partners were also shown to have linked to Chinese organised crime members.
Since then, the fallout has been severe, mostly in the form of multiple investigations by regulators from New South Wales.
The Suncity junket, one of the largest in the region, was forced to cut ties with its Australian casino partners.
And now, the Melco deal is on hold.
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