The Crown Resorts Ltd (ASX: CWN) share price is dropping lower on Friday. At the time of writing, shares in the casino operator are trading at $12.31 each – down 0.73%. For context, the S&P/ASX 200 Index (ASX: XJO) is currently sitting 0.24% higher.
The casino operator's price fall comes as the funding, time, and scope of the Victorian royal commission into Crown Melbourne is extended.
Let's take a closer look at the latest developments.
What's happening with the royal commission?
Victorian Acting Premier James Merlino confirmed the royal commission into the granting of the Crown Melbourne licence would be extended by 10 weeks, with its funding boosted by $9.75 million. This was at the request of the commissioner, Raymond Finkelstein.
"We established this royal commission to get the answers we need about Crown – and this extension will ensure the scope of evidence provided so far is able to be thoroughly considered," Merlino said.
In its statement to the ASX, Crown said it would continue to "fully co-operate" with the royal commission.
Helen Coonan, former senator and current Crown chair, said:
As executive chairman, I have made clear that any shortcomings identified by the royal commissions will be addressed. The board and I are committed to making Crown a stronger, more transparent and respected company.
We have initiated a sweeping program of significant reforms, enhancements and personnel changes. We cannot change the past, but we can be absolutely steadfast in the approach we take to driving the culture and transparency of the company into the future.
The Victorian Government says the extension will allow commissioner Finkelstein to investigate "a wider range of matters". The government says this will be necessary due to the "seriousness of evidence produced through hearings and submissions to date".
Investors may be worried by this news, judging by the drop in the Crown share price today.
The cascade of investigations into Crown's operations was sparked when the New South Wales Independent Liquor and Gaming Authority found the company "unsuitable" to hold a gaming licence in the state.
Crown share price snapshot
Despite the problems besieging it over the past 12 months, the Crown share price has increased by around 20%. The rise is due to both a rebound from the COVID-19 market crash of March 2020, and takeover approaches by Blackstone Group Inc, Oaktree Capital, and Star Entertainment Group Ltd (ASX: SGR).
Crown Resorts has a market capitalisation of around $8.3 billion.
