Speculation has surrounded Crown Resorts for over a year regarding Consolidated Press Holdings Group’s (CPH) intentions for the company. CPH is controlled by James Packer and, at various times, the market has speculated a bid will be made by its major shareholder and this speculation has led to gyrations in the Crown’s listed securities, including its debt securities.
Crown Resorts has two ASX-listed notes; Crown Notes I (ASX code: CWNHA) and Crown Notes II (ASX code: CWNHB). They are similar in structure; both are subordinated debt securities and both pay a floating rate of interest at a margin over BBSW. However the margins, call dates and final maturity dates differ.
![insight]](https://www.yieldreport.com.au/wp-content/uploads/2017/02/insight.png)
As at 23 February 2017
Crown has announced its intention to offer to buy-back all outstanding CWNHA notes, which have a face value of around $532 million. The buy-back will be subject to “all necessary approvals” and, by the look of the announcement, it will not proceed immediately; according to Crown it will commence no later than 14 September 2017. This does not necessarily mean the buy-back may not commence earlier but it leaves quite a large period of time in which Crown may act. Note the offer does include the series 2 CWNHB notes which Crown says “remain an important part of the company’s capital structure.”
Crown intends to buy the notes “on-market” which means it will place a bid for the notes on the ASX, and soak up the notes at a set price until it decides otherwise. In its ASX release, Crown has stated it “reserves the right to vary, suspend or terminate the buy-back at any time” but at this stage the market is not aware of the price at which Crown intends to bid.