Wynn Resorts (WYNN - Get Report) approached Australia's Crown Resorts (CWLDY) with a A$10 billion ($7.1 billion) takeover offer, Crown Resorts said Tuesday in a statement to the Australian Stock Exchange.
"The discussions between Crown and Wynn are at a preliminary stage," said Crown, which is one of Australia's largest gaming and entertainment companies. "There is no certainty that these discussions will result in a transaction."
Crown Resorts owns casinos in Melbourne and Perth, Australia, and London.
Wynn Resorts, the world's No. 2 casino operator, confirmed Tuesday in a filing with the Securities and Exchange Commission that it was talking to Crown Resorts but said it wouldn't comment further.
The deal would offer Wynn a hedge against Macau, the Chinese gambling hub where its licenses are up for renewal, by giving it two lavishly revamped Australian casinos and a third still being built on the Sydney harbor front, Reuters reported.
Crown said Wynn was proposing to buy the company in a cash-and-stock deal. The companies have yet to agree on a value or deal structure, and the current proposal hasn't been sent to the board, the company added, Reuters reported.
"The proposal is subject to a number of conditions including due diligence, Wynn obtaining all the necessary regulatory approvals and a recommendation by the Crown board," Crown said in a statement. "The Crown board has not yet considered the most recent proposal from Wynn."
Crown Resorts shares rose 19.7% to A$14.05 in Sydney. Wynn shares fell 0.6% to $144.05 in premarket trading.