The man behind Australian casino giant Crown Resorts Limited, James Packer, is reportedly part of an investments vehicle that last week purchased a significant stake in rival operator The Star Entertainment Group Limited. According to a report from The Sydney Morning Herald newspaper, 49-year-old Packer holds a 25% stake in Ellerston Capital Limited, which acquired the shares in The Star Entertainment Group Limited from Genting Group on July 13 to take its interest in the Sydney-listed casino operator to over 5%. Mr Packer is a passive investor in the fund and any move on his casino rival would be independent of him.
The Star Entertainment Group Limited is responsible for The Star Sydney, which overlooks Darling Harbour near the centre of Australia’s largest city, along with The Treasury Casino and Hotel in Brisbane and last week saw local investments and trustees group Perpetual Limited purchase the majority of Genting Group’s offloaded stake. Kuala Lumpur-listed Genting Group had held some 46.4 million shares in The Star Entertainment Group Limited with The Sydney Morning Herald reporting that Ellerston Capital Limited purchased its increased stake via Ashok Jacob, its Chairman and Chief Investment Officer, to now be listed as a “substantial shareholder” in the Brisbane-based firm.
April reportedly saw Ellerston Capital Limited acquire an initial interest in The Star Entertainment Group Limited, which also runs Queensland’s Jupiters Hotel and Casino Gold Coast and is in the midst of planning a $1.9 billion casino, hotel and entertainment project for the Queen’s Wharf precinct of Brisbane, as it believes the operator is set to prosper due to the growing number of tourists visiting Australia from China and south-east Asia.
The Sydney Morning Herald reported that this is not the first time that Packer has held a large part of The Star Entertainment Group Limited as the businessman sold his 10% interest in the firm in 2013 only two weeks after winning approval from the New South Wales Independent Liquor and Gaming Authority and the Queensland Gaming Authority to lift his stake to 23%.
The fund said in its April newsletter that it had taken an interest in The Star because, despite a decline in VIP activity, it believed The Star would be a beneficiary longer term of the ongoing growth in inbound Chinese and South East Asian tourism into Australia. Ellerston said in its newsletter, “We see solid growth prospects for Star, driven by its capital investment program and growth strategy.”
