James Packer wants out of the gambling business
Analysis: For a gambling tycoon it seems billionaire James Packer just cannot take a trick. The deal was an exit from the business after years of personal and business strife for Packer.
Analysis
For a gambling tycoon it seems billionaire James Packer just cannot take a trick.
But one thing seems sure from the botched deal with Wynn Resorts — he wants out of the business.
Packer was set for a $4.6 billion payday from the takeover, which Crown Resorts confirmed in a statement to the Australian Stock Exchange.
Crown Resorts shares surged on the news while Wynn’s dropped.
And then Wynn Resorts took the deal off the table.
“Following the premature disclosure of preliminary discussions, Wynn Resorts has terminated all discussions with Crown Resorts concerning any transactions,” the company said just four hours after confirming the deal.
Crown confirmed that decision today: “Crown notes that Wynn has announced that it has terminated all discussions with Crown concerning any transaction.”
Today Crown Resort’s shares fell off a cliff, dropping more than a dollar in the first hour of trade and wiping out half the gains of yesterday.
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For Packer, 51, the deal was an exit from the business after years of personal and business strife that culminated in him stepping back from the board after his third nervous breakdown.
He told biographer Damon Kitney: “Some people handle pressure well and some don’t. I don’t. I don’t know if that is because I am wired that way. Or if it is because bad things have actually happened to me.”
Those bad things include a string of business disasters beginning with 19 of his Crown Resorts employees convicted in China for “gambling crimes”. Packer took the jailing of his staff hard.
It also led to a split from his long-term Macau casino partner Lawrence Ho, who angrily said Crown’s seduction of Chinese high rollers was “deliberately spitting on our faces”.
He sold out of his glitzy Hollywood movie production company RatPac and became embroiled in a corruption scandal involving Israeli Prime Minister Benjamin Netanyahu. There were also bitter negotiations culminating in him buying sister Gretel out of the company.
In his personal life he suffered an acrimonious and highly publicised split from girlfriend Mariah Carey that saw him plunged into depression and pile on the weight.
His solace has not been found in the boardroom but in spending time in Los Angeles with ex-wife Erica and their three children. He has spent $80 million on the former mansion of Danny DeVito to be near them.
“I’m tired of being on this rollercoaster. I don’t want to do it anymore,” he told Kitney. “I’m really ready to put my hands up for a few years. I really am.”
That could mean a serious witch hunt in the offices of Crown Resorts to see who leaked details of the potential deal before it was signed.
Analysts in the US believe Wynn pulled out because it did not want to be seen to be buying another company while its suitability is being examined by regulators in Massachusetts over its plans to open a $2.6 billion resort there.
Once that is sorted there is every chance Wynn could revisit the buyout, which would still be a great fit for its expansion plans. And that could mean Packer’s plans for putting his feet up are just on hold rather than completely off the table.
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