Melco and Crown part ways

Crown Resorts will sell its stake at Melco Crown Entertainment and the partnership will soon come to an end, as announced on Monday.

Macau.- Melco Resorts & Entertainment Ltd announced last Monday that its partnership with Crown Resorts will come to an end. The Australia-listed company will sell 165.3 million shares and will finalise the complete sell down of it’s stake at the joint venture, ending a twelve year old society.

Melco announced in a press release on Monday that it would be conducting a secondary sale of shares, as well as a concurrent repurchase of shares from Crown Resorts (according to Bernstein they represent around 11.2 of the MLCO’s total) which is expected to occur on May 15.

As stated in the press release, any shareholder arrangements between Melco International Development Ltd and Crown Resorts Ltd will be annulled following the sell down.

Melco’s chairman and CEO Lawrence Ho stated that “this transaction brings to conclusion the world’s most successful global gaming partnership, highlighting our ability to work with partners in both good times and more challenging operating environments.”

He also added that he “made the trategic decision to terminate the joint venture arrangement and allow Melco to pursue Japan alone” despite the company’s “positive history with Crown”. He noted that it “highlights the company’s confidence in, and commitment to, identifying and evaluating new markets which will drive long term shareholder value while contributing to the development of tourism and delivering other economic benefits for our host cities where we operate.”

Ho has also assured that “Macau remains the best gaming market in the World and a great place to invest” despite Crown exiting its position in the company.

Crown’s chairman James Packer is expected to use the US$987 million from the sell down to reduce Crown Resorts net debt.