Millennium Gaming and an affiliate of Oaktree Capital Management, L.P and Crown Limited have today terminated the Cannery Purchase Agreement which was entered into in December 2007. The parties recognised that the preconditions to completion would not be satisfied in time to allow the purchase as proposed to proceed. Under the termination agreement a full release has been given to all parties, including Crown and associated entities. A termination fee of US$50 million, due under the Cannery Purchase Agreement, has been paid by Crown to the Sellers.

Crown has also entered into further binding commitments in relation to Cannery. The company has agreed to pay Cannery US$320 million to subscribe for a preferred instrument. The preferred instrument has no coupon and is non-participating. In order for Cannery to issue Crown the preferred instrument, Cannery must receive any required gaming regulatory approval in Nevada and Pennsylvania.

In summary, Crown will pay US$370 million for an approximate 24.5% equity interest in Cannery in a two step regulatory process and will have an option to acquire the balance of the equity interests on a debt free basis for approximately US$1.4 billion exercisable at any time over the next 2 years but each of the two transactions is subject to regulatory approval. If the regulatory approval for issue of the preferred instrument is not received within the timeframes set out above, Crown will have paid a total termination fee of US$250 million and have paid US$40 million for an approximate 4.1% preferred interest in Cannery.

Any payments to be made by Crown under the termination arrangements and the New Cannery Agreements will be funded from existing US dollar cash reserves. If the preferred equity instrument is issued, then Crown's net debt is expected to be less than A$600 million. Crown considers these new arrangements represent a satisfactory outcome for its shareholders. Crown is looking forward to working cooperatively with the Cannery team to continue to grow the business including the launch of the new Meadows permanent casino in Pittsburgh which is due to open in April 2009.

News of the new agreement prompted an immediate increase in the value of Crown shares, which rose a record 13.5% in Sydney. As well as the Cannery agreement, James Packer has sold his Australian cattle ranches with over 300,000 cattle on land that covers more area than the Netherlands. UK-based Terra Firma Capital Partners Ltd has bought the properties. (E-03.13.09)

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