Mon, Aug 29, 9:38am by Staff Writer
James Packer has taken the somewhat surprising decision to sell around $450 million of his stake in his casino empire Crown Resorts.
The Australian has reported that Packer’s Consolidated Press Holdings sold 35 million Crown Resorts (CWN) shares at $12.80 to institutional investors over the weekend, reducing CPH’s stake in Crown from 53 to around 48 per cent
The 48 per cent stake is strategic for Packer, as he – through CPH – can reclaim a majority position with one further purchase. Under the Australian Stock Exchange’s creep provision, he can only buy an additional 3 per cent every six months.
The move is believed to be driven by CPH and Packer’s desire to reduce debt and restructure capital within CPH, following his settlement over the business with his sister Gretel Packer.
That settlement saw Packer take on considerable debt, which he has sought to ease with this latest sale.
While his father Kerry was known as media tycoon with strong casino interests, James Packer is much more focussed on the family’s casino empire, expanding into Asia as well as growing the Australian footprint of the business significantly.
This latest move is not being seen as a backward step in those ambitions, but merely as pragmatic step to protect the position of CPH.
Crown Resorts is currently pursuing a demerger of its operations, with its Asian gaming company Melco Crown and some other international assets being separated from Crown’s Australian casino businesses.
The Asian business is considered much more volatile in the current environment where the Chinese government is cracking down on corruption. The past year saw Crown’s Macau operations’ profit slump 64 per cent.
However, the overall business posted a normalised profit of $406 million last year.
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