Probity checks by Australian regulators into new Crown Resorts shareholder Melco Resorts & Entertainment and specifically its Chairman and CEO Lawrence Ho could take more than a year to complete, according to analysts.
Ho’s stunning acquisition of a 19.99% stake in the Australian casino operator, purchased from the private holdings company of Crown’s largest shareholder and former Melco partner James Packer last week, has already sparked the interest of local regulators who are expected to closely examine any possible business links between Lawrence Ho and his elderly father Dr Stanley Ho.
Of particular importance is a 2014 agreement between Crown Resorts and the NSW Casino, Liquor and Gaming Authority that specifically prohibits any association with Dr Ho – one of the founding fathers of Macau’s casino industry.
With regulatory checks set to take place in NSW, Victoria and Western Australia – the three states in which Crown boasts assets – Bank of America Merrill Lynch analyst Melinda Baxter stated, “In our view, regulatory approval could take up to a year [or potentially longer] to achieve.”
Speaking with the Australian Financial Review over the weekend, former Chairman of the NSW regulator Chris Sidoti, who oversaw the 2014 agreement with Crown, said that while a new probity check into Ho was important, there were no business links found between the Melco boss and his 97-year-old father the last time such an investigation was conducted. Crown Resorts was still partnered with Melco in Macau when it was given the green light to develop its AU$2.2 billion Crown Sydney at Barangaroo.
Lawrence Ho told the Australian Financial Review on Friday that, “Both Crown and I have always stressed that my business dealings are independent of my father’s interests. We have already been in partnership with Crown for 12 years and have passed probity screens from regulators without an issue.”
Melco resorts revealed last week that it would seek representation on the Crown board with two positions reported to be in its sights.