Crown Resorts Ltd. operates in the gaming and entertainment industry, which focuses in the resorts, entertainment sectors in Australia and Macau. It operates through the following business segments: Crown Melbourne, Crown Perth, Crown Aspinall’s, and Wagering and Online. The Crown Melbourne segment includes casino, hotels, function rooms, restaurants and shopping and entertainment facilities. It also operates electronic gaming machines and table games. The Crown Perth segment includes hotels, a world-class convention centre, gaming options, food and beverage offerings, entertainment and tourism offerings. The Crown Aspinall’s segment includes casinos and gaming.
Why is Crown Share Price struggling on ASX today?
Today, CWN shares were on the decline once again. Crown shares going down and making headlines has become more of a theme these days with all the negative press that the company seems to be attracting. CWN shares declined by 2.24% to $10.02 a share today on the back of the Star announcing that they have withdrawn their merger offer. The Proposal outlined significant strategic and value accretion benefits for the shareholders of both companies, including estimated cost synergies of between $150 million to $200 million per annum and the potential to create significant value from a sale and leaseback (or similar structure) of the enlarged property portfolio.
However, the withdrawal probably makes sense if we put ourselves in the shoes of Star’s management team. Crown could lose its Melbourne casino license and these developments have material impacts. The Star noted that they remain focused on its growth initiatives including its world-class multi-billion dollar Queen’s Wharf Brisbane integrated resort due to open in late 2022 and its Gold Coast masterplan.
As for Crown, it’s an extremely rocky road ahead and CWN shares are expected to continue dropping next week.
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