James Packer’s Exit Helps Privatization Plans Says Deutsche Bank
Australian billionaire and ex-chairman of Crown Resorts James Packer announced on the 21st of December that he would be stepping down from the Crown Resorts board. Packer has clearly been distancing himself from the company during the past few months as in August 2015, Packer decided to resign as the Chairman of Crown Resorts.
Packer who helped build Crown Resorts into the multi-billion dollar establishment that it is will continue to be the majority shareholder with a 53 percent stake in the company via Consolidated Press Holdings (CPH) a company that Packer uses for his financial investments. There are a number of rumors floating around over the possible reasons for Packer stepping down including wanting to spend more time with his family in Los Angeles and business interests in Israel to not being able to manage the debt that Crown Resorts has accumulated over the past couple of years.
There have also been speculations over the fact that Packer has plans to privatize Crown Resorts and is currently in talks with a number of pension funds and private equity firms. Packer will continue to play an active role in Crown Resorts as the majority of his wealth is tied up to the firm and he is also expected to receive a salary of around $10 million for the first time in Crown’s history.
Deutsche Bank stated that Packer’s goals to privatize Crown Resorts would have been a lot more difficult had he continued as a member of the board of directors. By him stepping down, the entire privatization process could go forward a lot more quickly. Deutsche Bank confirmed that any new remuneration arrangements made by CPH to acquire any assets of Crown Resorts or Crown minorities could be processed a lot quicker as Packer is no longer on the board and has a restricted amount of influence.
Packer was happy to step aside and concentrate on a number of new Crown resort projects including the new casino that is expected to be completed by 2020 in Sydney Australia. Packer said he went ahead with his decision after he realized that Robert Rankin was doing a great job as the new chairman of Crown Resorts and also CPH.
In a statement, Rankin speaking about Packer’s departure from the board said
I don’t like the word sabbatical, it’s about re-emphasising where your priorities are, you need to be comfortable the mothership is well run and functioning in a coordinated and effective manner. Maybe [the move] does subconsciously signal James’ pragmatism. He is a visionary but pragmatic leader.