Crown Resorts, the gambling and resorts company controlled by Australian billionaire James Packer, will reduce its exposure to the Macau market and has scrapped plans to pursue a spin-off of its international operations.

The news comes amid a tumultuous few months for the company, most prominently with some of its employees in China being detained in a move believed to be related to a crackdown on the practices used to lure high rollers on the mainland.

Crown said in a statement to the ASX on Thursday it had entered into an agreement to sell 198m shares in US-listed Melco Crown Entertainment back to its joint venture partner Melco International Development for approximately A$1.6bn ($1.2bn). The proceeds will be used to reduce net debt by A$800m, fund a special distribution of about A$500m and facilitate a A$300m share buyback.

The deal reduces Crown’s stake in MCE, which houses the Macau and Philippines operations of both companies, to 14 per cent from 27.4 per cent. In May, Crown offloaded 155m shares for around $800m, cutting its stake from 34.3 per cent. Crown said at the time it “intends to maintain a significant investment in MCE” and that the sale formed part of its ongoing capital management strategy.

As well as reducing its exposure to Macau, Crown’s board said it decided to not proceed with Alon, the Las Vegas project in which it is partnered with Oaktree Capital Management, and that it was “assessing options to optimise the value” of its investment in the project.

The sum of those decisions means previous plans, announced in June, to explore a spin-off of Crown’s international assets have been shelved. However, the company said it continues to prepare for a proposed initial public offering of a 49 per cent interest in its Australian hotels and associated retail properties.

Robert Rankin, Crown Resorts’ chairman, said the business decisions were “strategic and for the long-term and will underpin the Company’s future over the next decade.”

Rowen Craigie, chief executive, described the board’s decision to not puruse a spin-off of the international assets as “a prudent alternative” and said that “Crown shareholders will be afforded greater transparency in respect of the company’s asset portfolio and have the benefit of additional capital initiatives.”

Crown shares were placed in a trading halt this morning, but are down 9 per cent in 2016.

Defending its decision to explore a spin-off for the international assets, Crown said in June that investors were undervaluing its Australian assets and that its share price was too closely linked to the performance of its investments in Macau.

If anything, though, Crown has this year been unable to match the recovery in Asia-listed casino stocks that are exposed to Macau, which is the only place in China where casinos are legal. Gaming revenues in the former Portuguese colony took a hit after Beijing’s 2014 crackdown on corruption, but has shown signs of stabilisation this year. Hong Kong-listed peers, such as Galaxy Entertainment and Sands China have seen a much stronger share price performance in the second half of this year than Crown.

On Friday, rumours that Macau was set to reduce the daily withdrawal limit from ATMs for Chinese bank card holders caused a sharp sell-off for casino stocks around the region. While those rumours proved to be untrue, the stocks have yet to recover from their closing levels at the end of last week.

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