Crown Resorts To Bid $2B For Las Vegas Cosmopolitan Resort and Casino

Contrary to online casinos that are banned in Australia under the Interactive Gambling Act 2001, this will be a legal venture in which Crown Resorts will have to comply with the gambling laws in Nevada, which differ from those in Australia. Fortunately, the gambling laws in Nevada are more permissive, allowing a wide range of gaming activities (including online casinos). Australia has stricter regulations, more restrictions, and tougher licensing requirements. 

According to a report from the Australian Financial Review (AFR), Crown is planning to submit an expression of interest for the Blackstone Group-owned Cosmopolitan. The sale price is expected to range between $1.5 billion and $2 billion, highlighting the investment that Crown Resorts is willing to make.

This acquisition, should it succeed, marks a step towards Crown’s goals to expand to the US market. 

Crown Resort’s expansion is not limited to just Las Vegas, as its also seeking local opportunities. Under the guidance of owner and billionaire James Packer, it recently vied for a casino project in Brisbane that’s valued at over $1 billion. Crown also recently secured the right to operate a VIP gaming facility at a luxury hotel project in Sydney. 

The casino operator is also growing beyond Australian borders, with new casinos being constructed in the Philippines. Previously, Crown was also planning to develop a casino in Sri Lanka, but this project was dropped. The company also expressed interest in constructing a casino and resort in Japan, valued at over $5 billion. 

The potential acquisition of The Cosmopolitan is Crown’s third attempt to enter the US market. Previous attempts included the purchase of Cannery Casino Resorts in 2007 for $1.75 billion and investing $250 million for a 19.6% stake in the Fontainebleau Resort, both based in Las Vegas. However, these investments were ill-timed as they coincided with the global financial crisis, resulting in significant losses for Crown Resorts. 

The Cosmopolitan is not a major success either. It opened in December 2010 and has since struggled financially, with net losses of $298.3 in its first three years of operation. Deutsche Bank took ownership after spending $4 billion on the resort when the previous owner defaulted on a loan. The Cosmopolitan was sold in 2014 to Blackstone Group for just $1.73 billion. Blackstone then sold the casino’s operations in 2022 to MGM Resorts for $1.63 billion.

Despite changing hands so many times, Crown’s potential bit reflects its strategy to diversify its portfolio and get a foothold in international markets. By acquiring high-profile properties and investing in new markets, Crown Resorts aims to attract more clientele and boost profitability. 

As Crown prepares to lodge its bid for The Cosmopolitan, industry observers will be keeping a close eye to see how it will impact the operator’s standing in the international casino market.