Seismic changes by powerful families

James Packer’s openness to selling Crown Resorts to a US rival is the latest in a series of major moves by three powerful dynasties.

05/11/2000 Kerry & James Packer together today at Werribee where James was playing for Ellerston in the Melbourne Cup Polo Tournament. pic Graham Crouch

James Packer’s apparent openness to selling his Crown Resorts business to rival Wynn Resorts is the latest in a series of major moves by three powerful dynasties that have helped shape Australian business and society.

A sale of Crown would follow seismic moves in the past year by both the Lowy family that built the Westfield shopping mall empire and the Murdochs, who fashioned a global media empire from a ­single newspaper in Adelaide.

But gambling giant Wynn Resorts last night walked away from its $10 billion takeover talks with the James Packer-backed Crown Resorts, blaming the “premature disclosure” of the deal by the Australian casino major.

Mr Packer has been a deal-making machine since the death of his father, Kerry, in 2005, elevated him to the top of the media, gambling and investment empire that built up to a $6.9 billion fortune over two generations.

Within a year, he had sold the media assets that included the Nine Network and Australian Consolidated Press magazines to private equity group CVC for a cool $5bn. He then embarked on an ambitious expansion of the already global gambling business that he had helped create, including Crown casinos in Melbourne and Perth and the Melco joint venture in Macau.

As the setbacks have mounted, however, James has steadily shrunk an empire that was once an influential player across the Australian market, with interests including cattle stations, chemicals, resources funds management, financial services, and women’s fashion.

The global financial crisis, a settlement of his father’s estates with sister Gretel, and over-aggressive marketing for Crown in mainland China that resulted in 19 staff being arrested took their toll.

The sale of Crown would have complete that exit and make Packer a passive investor in Wynn Resorts. But it is the patriarchs of the Lowy and Murdoch families that have been more influential in shaping major moves in the family firm.

Last year, Frank Lowy completed a $33bn sale of the international arm of his Westfield shop­ping mall empire in a deal with European giant Unibail Rodamco.

A Holocaust survivor, Mr Lowy introduced Australia to shopping malls, building Westfield from a delicatessen in western Sydney to a major global operator with trophy properties in London and across the US.

The deal drew a line under any dynastic ambitions, with sons Peter and Steven reduced from hands-on proprietors to passive shareholders in a much larger international company.

Just last month, Steven stepped down from the board of Scentre Group, the publicly listed company that holds the Australian mall assets that were not part of the Unibail deal, breaking the last formal link with the family.

Around the same time, News Corp founder Rupert Murdoch completed a $US71bn deal to sell much of the global entertainment assets he had accumulated, including 21st Century Fox to Disney. The deal delivered a reported $US16bn to the Murdoch family — including $US2bn for each of his six children.

The Murdoch family also holds 39 per cent of News Corp, whose assets include The Wall Street Journal, Dow Jones, The Times, The Australian and a controlling interest in realestate.com.au.

The deal has also settled speculation about succession, with eldest son Lachlan taking the reins as chief executive and chairman of Fox Corp. He is also co-chairman of News Corp with his father.