Gaming authority pushes on with Crown probe

Two billionaires may have dodged a bullet but they haven’t skipped a bath.

Two billionaires may have dodged a bullet but they haven’t skipped a bath.

The Australian understands that Hong Kong Tycoon Lawrence Ho and the man he calls his “brother”, James Packer, are yet to be officially called to appear before the NSW regulators’ high-stakes inquiry into Crown Resorts.

And if they haven’t received a call to be grilled before the inquiry by now, it is unlikely that they ever will, following Mr Ho’s decision to sell his 9.9 per cent stake in Crown.

Mr Ho had originally planned to acquire a 19.9 per cent stake in Crown from Mr Packer’s private investment vehicle Consolidated Press Holdings for about $1.76bn over two tranches.

The NSW Liquor & Gaming inquiry, among many things, was tasked with examining whether the planned buyout of the Crown stake by Mr Ho’s Melco raised probity issues. And at stake was Crown suitability to hold a licence for the $2.4bn Crown Sydney development in Barangaroo, which is due to open in December.

But Mr Ho, who walked away from buying his second tranche of shares from Mr Packer in February — resulting in $880m in opportunity cost for the Australian billionaire — has now disappeared completely from Crown’s register after selling his 9.9 per cent holding to private equity giant Blackstone.

The deal, priced at $8.15 per share, wiped more than $300m off Mr Ho’s Crown investment. But it also ended any need for NSW Liquor & Gaming to order him to appear before its inquiry, which the regulator confirmed will still go ahead once the coronavirus pandemic passes.

It is the latest instalment in the drama surrounding the inquiry.

First there was Mr Ho’s decision to not proceed with acquiring another 10 per cent stake in Crown from Mr Packer. He cited the coronavirus, which had shut down Macau’s entire casino industry for much of January and half of February, costing billions in lost income for the Asian gaming powerhouse.

Mr Ho said he wanted to focus on his core markets in Macau, The Philippines and Cyprus as well as Melco’s efforts to win a Japanese gaming licence, rather than pursue plans to expand his casino empire to Australia.

If that was not enough, he doubled down on his decision, lobbing an 11th hour challenge to the NSW gaming regulator in an attempt to derail the inquiry, claiming the regulator was ­overstepping its powers. But the regulator was undeterred, with a spokeswoman saying at the time the inquiry would still proceed.

The legal challenge appeared to succeed, with the Supreme Court siding with Melco. But the victory was short-lived.

The NSW Supreme Court of appeal overturned the landmark judgment that limited the powers of the inquiry into Crown’s casino operations after finding the judge “erred” in her decision.

Three appeal judges found that NSW Supreme Court judge Christine Adamson had misread the relevant legislation with her ruling the inquiry did not have the full powers of a royal commission.

And so the show rolled on until coronavirus halted it in March. The gaming regulator has now deferred the inquiry until after the COVID-19 pandemic passes or it is safe to resume hearings. It noted Mr Ho’s decision to sell out of Crown and will make the necessary adjustments to the inquiry.