The A$12.50-a-share proposal, disclosed by Crown on Friday, is the third from Blackstone and pushed Crown's shares 17% higher. The stock was still below Blackstone's indicative price, suggesting a degree of doubt that a deal will eventuate.

The revised offer puts Blackstone in the box seat to win control of Crown, which has faced devastating misconduct inquiries in every state it operates in, plus protracted COVID-19 lockdowns.

Rival bidder Star Entertainment Group Ltd (SGR.AX), an Australian casino operator, has backed off its proposed deal citing regulatory uncertainty. It now faces its own misconduct allegations.

Crown still faces a public inquiry into governance and anti-money laundering compliance at its second-biggest earning casino, in Western Australia state, as well as a federal anti-money laundering investigation.
The company founded by billionaire James Packer has already acknowledged to regulators in New South Wales and Victoria that it failed to prevent criminal transactions.

The most consequential of the inquiries, which threatened to withdraw the gambling licence in Victoria behind three quarters of Crown's profit, ultimately cleared the company last month to keep operating under supervision.

Crown had favoured Star's buyout approach over an earlier Blackstone proposal, but Star's troubles threaten to derail any attempt to reopen talks and Blackstone's latest proposal matches Star's cash option.

"Crown is a high-quality, strategic asset," said Steve Johnson, chief investment officer at Forager Funds Management.

It was "not surprising private equity is back at the table" after it was allowed to keep its Victorian licence, but Blackstone's offer appeared to undervalue Crown, Johnson added.

Crown said its board would consider the latest Blackstone proposal although it had not yet formed a view on its merits.

A spokesperson for Blackstone, Crown's second biggest shareholder with 9.99% of its shares, confirmed the offer without commenting further.

A Star spokesperson said recently the company had withdrawn its Crown proposal but "as we have said consistently since that time, The Star remains open to exploring potential value enhancing opportunities with Crown".