James Packer Scales Back International Ambitions to Focus on Aussie Market
James Packer, who is the owner of one of the biggest gambling entities in Australia has decided to focus more on his Aussie business. He will achieve that by scaling back on his overseas and international business ambitions. This presents a dramatic shift in his strategy, which will see the Crown Resorts company focusing more on the Australian market.
Crown Resorts, which is still in the process of dealing with the arrest of its senior employees last October in China, stated that it intends to sell almost ½ of its 27 percent stake in the Melco Crown Entertainment. It is going to sell it for 1.6 billion dollars to Lawrence Ho. Lawrence Ho is Packer’s partner that is based in Hong Kong. That is not all, as in a clear signal that it intends to completely retreat from the Macao Business, Crown Resorts stated that it is looking and exploring other possibilities to sell the remainder of the stake in the Melco Crown business.
Crown Resorts Delays its Las Vegas Plans
It seems that not only the Macau business has been abandoned by Crown Resorts. This is because James Packer’s group also stated that it is not planning to proceed with its Alon Casino Plans, at least not at this time. These plans included the development that is worth 2 billion dollars, it was located in Las Vegas. These plans were announced last June, which aimed to separate the Australian casinos from the international assets.
Rowen Craigie, the Chief Executive of Crown Resorts stated that this decision by the board is quite a prudent alternative when compared to the proposed asset demerger. The change is the company’s strategy and its retreat from the Chinese market means that Crown Resorts is almost focusing entirely on the Aussie market. This is because it is where Packer has placed billions on the potential success of the hotel and luxury casino development that is taking place in Sydney in Barangaroo.
The waterfront scheme is based on the attraction of the ultra rich and wealthy Chinese gamblers. The question is, will it manage to succeed and avoid the problems that faced the Macau assets and the Macau business. This is because of the crack down on the high rollers by Beijing.
Crown’s Drop in Turnover in Australia
The 1st half trading update that Crown has released has showed a forty percent drop in the turnover from the high rolling gambling sector at the Aussie casinos. This is when compared to the same period of last year. Commenting on that, Crown stated that the extremely high VIP gambling action that occurred in the same period is the reason behind the skewed results. On the other hand, half of the profit coming from the sale of the Chinese assets in Macau is going to pay off the debt of 800 million dollars for the Barangaroo project.