* Crown cancels three-way breakup plan
* Now plans to cut 27.4 pct Melco stake to 14 pct
* Melco stake sale will raise $1.2 bln
* Cancels Las Vegas casino development
* Warns VIP turnover in Australia down 45 pct in first half
(Recasts, adds Las Vegas analysis)
By Byron Kaye and Jonathan Barrett
SYDNEY, Dec 15 Australia's No. 1 casino company
Crown Resorts Ltd is planning a near-total exit from
the world's two biggest gaming hubs, Las Vegas and Macau, as a
gambling crackdown in China hits profits and throws its
expansion plans into disarray.
In a surprise trading update on Thursday, the company
scrapped plans to build a casino in Nevada's famed strip, said
it would sell half its stake in Macau-focused Melco Crown
Entertainment Ltd and cancelled plans to spin off its
The retreat from overseas casinos shows the impact the
Chinese government's anti-graft campaign is having on casino
operators throughout Asia, especially the southern Chinese
territory of Macau, the only place in China where casinos are
Majority owned by Australian billionaire James Packer, Crown
has been hard hit by the decline in VIP gaming revenue at its
Australian resorts and was rocked in October by the arrest of 18
of its staff for "gambling crimes" in China.
"There's no doubt that those arrests changed everyone's
outlook for the sector," said Angus Gluskie, a portfolio manager
at White Funds Management, which holds Crown shares.
"It's not as easy as it previously looked."
Crown said it would use the A$1.6 billion ($1.2 billion)
proceeds from the sale of its Macau stake to cut debt and pay a
special dividend of A$500 million, more than half of which would
go to Packer himself.
Macau has suffered gaming revenue declines every month for
more than two years, while Crown said turnover from VIP gamblers
- largely Asian tourists - at its Australian casinos would
likely fall 45 percent in the six months to end-December.
Overall Australian revenue would fall 12 percent for the
Crown shares are in a trading halt as the company prepared
to give more information about its plans for its remaining stake
in Melco Crown. The stock has fallen by a fifth since August.
LEAVING LAS VEGAS
Crown did not elaborate on its decision to scrap development
on the site slated for Alon Las Vegas, but it shuts the door on
the company's third attempt to establish itself in the famous
When Packer inherited his late father's broadcasting,
publishing and gambling conglomerate in 2007, his first moves
included selling its media assets and buying two Vegas-based
casino interests, one of which collapsed the following year
while the other was written off in 2015.
"I don't think there was really anyone out there who was
enthusiastic about them going back in to Vegas and so pulling
out is the smart thing to do," said Theo Mass, a partner at
Arnhem Investment Management which holds Crown shares.
"The market is not convinced Crown would make a difference
Crown's U.S. interests are now limited to a one-fifth stake
in Japanese restaurant chain Nobu and a 2 percent stake in
Casino firm Caesars Entertainment Co.
While Crown cancelled the demerger - a plan it recommended
to shareholders as recently as October - it said it would still
spin off a 49 percent stake in some Australian hotel properties.
Crown's first-half results are due in February 2017.
($1 = 1.3524 Australian dollars)
(Reporting by Byron Kaye and Jonathan Barrett; Editing by