Crown shares plunge after Wynn takeover offer collapses


Wynn's proposal is a cash and share buyout at A$14.75 (US$10.54) per share, for a total value of A$10 billion.

Wynn operates large resort-and-casino complexes in Las Vegas and Chinese gambling hub Macau, with another under construction in MA.

Wynn walked away from the deal after details of the offer became public through a leak to an Australian newspaper.

Wynn Resorts received written confirmation today from the Nevada Gaming Control Board that, subsequent to its in-depth investigation of the Company resulting from allegations against the company's founder, CEO Matt Maddox was "found suitable as an officer of Wynn Resorts, Limited in Nevada in January 2010, and remains in good standing with the Nevada Gaming Control Board".

That offer would have valued Crown at around $10billion.

Commenting on Wynn Resorts' sudden termination of discussions with Crown Resorts, brokerage Sanford C. Bernstein Ltd stated that, "at this point, there's no guarantee that any potential discussion around the deal will not resurface".

With the deal seemingly now dead in the water, Crown shares have been reported to jump as much as 22% from the announcement yesterday. In this case, Wynn's inexperience with pursuing big deals also likely played a factor, some analysts added. Board members say that they didn't understand about the compensation.

Crown, majority owned by Mr Packer's Consolidated Press Holdings, has operations in Melbourne, Perth, and London, and has a luxury resort development in Sydney's Barangaroo due to be completed in 2021. Instead of keeping any details confidential, however, Crown Resorts confirmed the rumour and even disclosed Wynn's proposed price.

It has a market cap of just over $US15 billion or just over $A21 billion, so paying just over $A10 billion for Crown is a big risk.

Wynn Resorts Ltd runs several casinos in the United States and Macau.

Crown stock dropped 10 percent at the open, then pared some losses to trade 8.5 percent under Tuesday's closing price, while the broader market fell 0.1 percent. It is fighting fierce competition for an operating license in Japan.

The company has since closed nearly all its regional marketing offices in Asia, which funneled big-stakes players to Australia, and sold out of a Macau casino venture.

Joan Vennochi, a Globe columnist and Pulitzer Prize victor, writes, "Steve Wynn is gone from Wynn Resorts".

Founder Steve Wynn sold his entire stake in the Las Vegas-based firm after he stepped down earlier this year as chairman and chief executive in the wake of allegations of decades of sexual misconduct. He has denied that any of his sexual relationships were nonconsensual.