The gaming regulator in New South Wales says it will investigate whether casino firm Crown Resorts Ltd breached its gaming licence for that Australian state when its largest shareholder agreed to sell a 19.9 percent stake in the company to casino operator Melco Resorts and Entertainment Ltd.
Crown Resorts is developing at Barangaroo in Sydney, New South Wales, what will be its third Australian casino resort. The company said earlier this month that the Crown Sydney project (pictured in a rendering) remained on schedule for completion in the first half of 2021.
The New South Wales Independent Liquor and Gaming Authority (ILGA) published on Thursday the “terms of reference” for its previously-announced inquiry, a day after the involved parties announced the deferral of the acquisition of a second tranche of shares in Crown Resorts.
Melco Resorts, a company controlled by gaming entrepreneur Lawrence Ho Yau Lung, announced in May that it was paying US$1.2 billion to acquire a 19.99-percent stake in Crown Resorts. CPH Crown Holdings Pty Ltd – controlled by Australian businessman James Packer – is the seller.
Under the original agreement, the closing of the first tranche of 67,675,000 shares – equivalent to a nearly 10 percent stake – of Crown Resorts occurred on June 6. The closing of the second tranche was scheduled to occur on or prior to September 30.
Melco Resorts said on Wednesday that the parties decided to postpone the acquisition of the second tranche of Crown Resorts shares “to allow more time for the relevant Australian regulatory processes to be completed”.
Melco Resorts said in a statement sent to GGRAsia earlier this month that it would participate “in any probity review process and cooperate with any inquiry” that was required in relation to its investment in Crown Resorts.
In Thursday’s statement, the ILGA said it would probe whether the transfer of shares in Crown Resorts constituted a “breach” of the restricted gaming licence or any other regulatory agreement. The inquiry is headed by former judge Patricia Bergin.
The inquiry will also look at whether Melco Resorts and Mr Ho – or other Melco Resorts representatives that could join the board of the Australian gaming firm following the share purchase – are of “good repute, having regard to character, honesty and integrity”; “have any business association with any person, body or association who is not of good repute”; and “are otherwise not suitable to be associated” with the wholly-owned unit of Crown Resorts that holds the gaming licence.
The regulator said additionally that the probe should review whether Crown Resorts should be allowed to retain the licence to operate a casino in Sydney. Aside from the probe into the share sale, ILGA will also review the suitability of Crown Resorts in light of recent media reports alleging that the company was involved in criminal activities.
The probe will investigate whether Crown Resorts engaged in money laundering, breached gambling laws or partnered with junket operators with links to criminal activities. Crown Resorts has denied the claims.
The investigation will also inquire and report on the state’s gaming regulatory framework, namely the efficacy of the New South Wales Casino Control Act in an “environment growing complexity” and “emerging risks for gaming and casinos”.
Crown Resorts already faces a separate inquiry by the Australian Commission for Law Enforcement Integrity, which main role is to investigate corruption within law enforcement bodies.
Aug 03, 2020Deutsche Bank Securities Inc said in a Saturday memo that under its most recent estimates for Macau casino gross gaming revenue (GGR), it anticipated the industry would generate third quarter GGR...
Aug 03, 2020
Aug 01, 2020
Macau market-wide year-on-year decline in casino gross gaming revenue for the first seven months of 2020