Casino Operator Melco Puts Off its Deal with Crown in the Wake of Coronavirus Affecting Tourism
Melco Resorts & Entertainment Ltd has for now put a stop to its plan to purchase stakes in Australia-based Crown Resorts Ltd. The reason cited was the dip in the number of travelers to China and also the government’s directive to keep the casinos closed for about two weeks in the wake of the deadly coronavirus outbreak.
Melco, a predominantly Macau-based casino managed by Lawrence Ho has dropped its plans for the second phase of the 19.99% buy-in of shares of the Crown. The U.S.-listed company was to buy the shares from billionaire James Packer; the deal was initially pegged at $1.19 billion.
Ho blamed the epidemic spread of the coronavirus for the cancellation of this deal. The deadly disease has till now claimed the lives of more than 600 people and over 30,000 have been infected. In Macau, the world’s largest gambling destination, 10 cases have been confirmed as of now.
Melco currently owns 9.99% stakes in the Crown, which they acquired last year. For now, they have also put on hold plans to contest for a position on the board of the Australian company.
To contain the rampage caused by this fatal virus, the state government has been taking all the precautionary measures. All the casino operators in the Macau region have been asked to down shutters for two weeks. The mandate has also directed all the business houses and factories to suspend operations for the time specified. Flight services have been hit by rampant cancellations. Other countries have also started evacuating their citizens and issuing travel bans. This has badly hit the second-largest economy of the world.