With the $960 million demerger of Tabcorp’s wagering and casino businesses now pretty much done and dusted it’s only natural that the focus has turned to the M&A side of things. In fact Tabcorp’s management had been quick to spruik the M&A angle before the demerger and the casino business, Echo Entertainment, has even been given a tentative value of $4.5 billion by some analysts. James Packer’s Crown has long been seen as the most likely suitor for Echo but it would seem that there may be other buyer in the wings. According to The Australian Financial Review, Echo has opened channels of communications with US players with regards to selling a stake in Sydney’s Star City Casino via a joint venture, with heavyweight Wynn touted as the likely partner. Tabcorp is spending big on sprucing up both Star City and Jupiter’s on the Gold Coast and one downside of a joint venture deal before the work is finished is that it won’t reap the full benefits of the millions invested in the refurbishment. Then again, joining forces with a US operator like Wynn could just be the thing that helps Echo pull in the heavy rollers. If the speculations of a deal with the likes of Wynn turn out have some weight behind them, we can surely expect some movement for Packer who could possibly move to have say on the proceedings. Meanwhile, the other big demerger story of the year was that of Foster’s Group, with the beer and wine units going their own way. Both units are again seen as likely takeover targets and there’s apparently some action on the beer front. According to Bloomberg, Molson Coors Brewing and Grupo Modelo SAB de CV, the maker of Corona beer, are working on a joint bid, with Bank of America and Deutsche Bank helping out on the financing. However, things are far from certain at the moment with Bloomberg saying that things could still fall apart if Grupo Modelo’s major shareholder Anheuser-Busch InBev SA decides against the purchase. (Credit: Google News, Wires)
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