‘I gave it no thought’: Packer forgot regulator’s ban

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After more than seven hours of evidence over two days, Packer will be back again tomorrow at 10am. See you then.

Women have borne the brunt of the recession, losing jobs at far higher rates than men. Easing COVID restrictions in regional Victoria has seen that state record slight rises in payroll jobs and wages. Follow updates here.

The superannuation act has recently been amended to require trustees to promote the financial interests of members.

Researchers specialising in the delicate art of ranking and analysing super funds say the ambitious government program could go badly wrong.

Private equity executive Ben Gray is understood to be Crown Resorts’ Mr X – the businessman threatened by James Packer that had him fearing for his wellbeing.

Street Talk understands Gray was spearheading talks for his then employer, American private equity firm TPG Capital, in 2015 which would have seen TPG invest in a consortium that would privatise Packer’s casino business Crown.

Gray, already Australia’s most high profile private equity investor, informed Packer that TPG was not willing to stump up $1.5 billion and would withdraw from the talks, when he received Packer’s emailed threats.

Sources said Gray took the threats very seriously – and even hired a bodyguard for some time afterwards.

Wednesday’s hearings for the casino inquiry with Packer have wrapped and he’s expected back tomorrow morning.

He ended it by adding to his evidence that Lawrence Ho blamed the coronavirus pandemic and a desire to focus on his businesses in Japan for the axing of the Melco deal.

Tomorrow’s witness list also includes former Macquarie executive and Crown board member Benjamin « Brains » Brazil, but an extra day of hearings with Packer may impact this schedule.

Non-executive directors, including Harold Mitchell, Andrew Demetriou and Antonia Korsanos were also slated to front the inquiry on Thursday.

Packer says he gave no thought to the NSW gambling regulator’s ban on Crown dealing with any companies related to Stanley Ho.

He’s now pointing back to evidence earlier in the day in which Packer said he was aware of the regulatory requirements.

Commissioner Patricia Bergin jumped in, saying it was more probably Packer didn’t turn his mind to the prohibition.

« Well, it’s obvious that you didn’t think about it because otherwise you would have done something about it, » she said.

Packer said he and Lawrence Ho, the son of casino mogul Stanley Ho, had discussed briefly a full merger between Melco and Crown.

« It quickly got to the position where that didn’t really suit him and it didn’t really suit me, » he said on Wednesday.

« I was more flexible on price because I wanted to do a deal with Lawrence, » Packer said.

Crown was still trying to get a joint venture off the ground in Macau with US casino giant Wynn Resorts and retain a 10 per cent stake in the project.

Counsel assisting Bell has read a series of emails between Ho and Packer ahead of a meet Ho had with Chinese officials

« In all seriousness I don’t think I should be banned from having a 10 per cent stake with no board representation. »

Packer threatened his senior executives after growing frustrated with what he deemed to be Crown’s poor financial performance.

The hearing heard last week that Packer had given his “blessing” to then-executive chairman John Alexander to pursue aggressive cost-cutting strategies.

“Make sure for your own sake you achieved the FY20 plan,” Packer told his management team, saying they had their heads in the sand.

“I was frustrated because I’d been saying for a good part of the previous financial year people had been too optimistic and bad news kept on flowing.”

“I thought it was in the best interests of Crown Resorts to have conservative budgets and get costs under control.”

Packer does not recall whether he was using the controlling shareholder protocol to give orders to Crown executives. So Bell has taken him to an email from him to executive chairman John Alexander to go through the CFO’s financial projections and ensure it is something Alexander believes in before it is presented to him.

There is another example where Packer orders then-CFO Ken Barton to give him more conservative financial forecasts he « can bank » as Packer was sick of missing targets.

Stanley Ho, who is at the centre of today’s hearings, died earlier this year at 98 with his son Lawrence taking over the casino empire.

Described as « flamboyant tycoon », he’s credited with transforming Macau from a sleepy peninsula to the world’s biggest casino centre.

We’re now looking at the controlling shareholder protocol Crown’s board implemented after Packer left both the casino operator and his private company CPH in 2018. The protocol ensured he would still receive updates on Crown’s confidential commercial information despite not holding any role at the company.

Counsel assisting Bell takes Packer to one of the many daily earnings reports from then-Crown CFO Ken Barton (now the chief executive) that he received under the protocol.

Bell takes Packer to another update, this time from Australian Resorts boss Barry Felstead, about key initiatives in Crown’s VIP business. This is more information Packer got under the controlling shareholder protocol.

There is a theme emerging here, as Bell takes Packer to yet another set of confidential updates that this time regards the construction and sales at Crown Sydney.

Bell is illustrating the sheer breadth of the information Packer had access to under the protocol ahead of other investors.

He’s underlining how NSW Liquor and Gaming had sensitivities about gambling mogul Stanley Ho being involved indirectly or directly in Crown.

The casino’s Barangaroo licence agreement was contingent on Crown doing its best not to be involved or Ho, including any related entities.

One of those entities listed included Great Respect Limited, a Virgin Island listed trust which Ho was a beneficiary.

At the time in 2017, Great Respect had shares in Melco, who was involved in a joint venture in Crown to set up a casino in Macau, China.

Women have borne the brunt of the recession, losing jobs at far higher rates than men. Easing COVID restrictions in regional Victoria has seen that state record slight rises in payroll jobs and wages. Follow updates here.

The superannuation act has recently been amended to require trustees to promote the financial interests of members.

Researchers specialising in the delicate art of ranking and analysing super funds say the ambitious government program could go badly wrong.

Source: https://www.afr.com/companies/games-and-wagering/packer-knew-of-great-respect-melco-connection-before-share-sale-20201007-p562ok

James Packer

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