James Packer steps back from casino empire, citing 'mental health issues'
Written on the 21 March 2018 by Ben Hall
Billionaire James Packer has stepped down as a director of casinos operator Crown Resorts, saying he is suffering from "mental health issues".
Packer will leave the board of Crown Resorts (ASX: CWN) because of personal reasons, according to a statement released by Packer's private investment vehicle, Consolidated Press Holdings.
"Mr James Packer today resigned from the board of Crown Resorts Ltd for personal reasons," the statement says.
"Mr Packer is suffering from mental health issues. At this time he intends to step back from all commitments."
Crown Resorts executive chairman John Alexander issued a brief statement to the ASX to announce the shock decision on Wednesday morning.
"We have appreciated James' contribution to the board and respect his decision to step down from his role as a director at this time," Alexander says.
This is the second time Packer has resigned from the board of Crown. He stepped down as a director in 2015 to pursue development projects at Sydney's Barangaroo, Melbourne, Las Vegas and online platforms.
The billionaire rejoined the board in January 2017 following the arrest of 18 Crown employees in China in 2016 as part of a crackdown by Chinese authorities on gambling and the flow of money overseas.
Over the past year he has exited his overseas ventures to focus on Australian casinos, and he has been through a highly-publicised engagement to, followed by a break up with, American music star Mariah Carey.
He has also been involved in a corruption inquiry into Israeli Prime Minister Benjamin Netanyahu where he was cleared of criminal conduct while Crown is also under investigation by Victoria gaming authorities over the alleged manipulation of electronic gaming machines.
Martin Lakos, senior investment adviser with Macquarie, says he doesn't believe Packer's departure will have a major impact on CWN's share price.
"At the end of the day the company seems to be in fairly good shape. Clearly there is going to be a big focus on what's going on at the new casino at Sydney's Barangaroo and it's been a major development," Lakos says.
"This is a big development (Packer's departure) but it doesn't change our view on the stock."
"Barangaroo has been well strategised by Crown and this is the segment they want to focus on, along with the higher net wealth customer, or gambler, and it won't be a casino that is open to the masses."
Julia Lee, equities analyst from Bell Direct, says she still sees some risk in investing in the big casino operators.
"I think the only reason you'd be buying into Crown or Star Entertainment at the moment is because you expect see some kind of bounce back or recovery in the VIP business," Lee says.
"I prefer Star at this stage, given its exposure to Queensland and the Commonwealth Games which should provide a boost on the Gold Coast as well as Queensland.
"In terms of Crown, I think the big risk is Barangaroo in that it is exposed to that VIP business and China still seems to be cracking down on that business."
Business News Australia
Author: Ben Hall