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The Sands Expo and The Palazzo resort are shown in Las Vegas, Nevada, U.S., August 25, 2016. Picture taken August 25, 2016. To match special report USA-VEGAS/SHELL REUTERS/David Becker
HONG KONG (Reuters Breakingviews) - Las Vegas Sands’ Sin City sale might fund a pivot to Australia. The casino company has cash in hand after negotiating a rich $6.3 billion for its Las Vegas assets. Crown Resorts is an affordable addition to its Asian empire, and the group founded by the late Sheldon Adelson would be welcomed by watchdogs Down Under, too.
The mathematics makes this more attractive than other opportunities. Sands is selling out of its American casinos at a valuation of 13 times EBITDA for 2019, according to Bernstein. Meanwhile, James Packer’s beleaguered business is currently valued around 8 times EBITDA for the same year, setting aside non-recurring items. Although the Australian outfit boasts a brand new property and mature resorts in Melbourne and Perth, share values are pressured by a year-long inquiry that revealed lapses in governance and compliance. As a result Crown lost its operator licence in Sydney, and may yet lose licences elsewhere. Australia’s tough anti-Covid-19 measures also impede growth.