Packer may use cash hoard for US casinos September 8, 2009 - 4:19PM Source from The Sydney Morning Herald
Australian billionaire James Packer may seek new US casino acquisitions after raising almost $900 million selling private assets, according to an analyst at Citigroup. Consolidated Press Holdings, the Packer family company, is ''unlikely'' to use the cash to bid for the 64 per cent of casino owner Crown it doesn't already own, Jenny Owen, a Citigroup analyst in Sydney, said in a note to clients today. Packer, who turns 42 today, may take advantage of ''rock- bottom prices'' as US casino operators struggle with high debt and slumping demand amid a recession, Citigroup said. Gambling on the Las Vegas Strip dropped 15 per cent in the 12 months ended June, according to the Nevada Gaming Control Board, with falling valuations causing Crown to write down its existing North American assets by $US1.5 billion in the past two years. ''2010 could prove an opportunistic time to buy US casino assets, as the ongoing downturn could be prolonged,'' wrote Owen, who rates Crown ``hold.'' ''Those assets could then be vended into Crown at a later date and a higher multiple.'' Anthony Klok, a spokesman for Melbourne-based Crown, didn't return a voicemail left by Bloomberg News seeking comment on the report today. Crown shares rose 3.5 per cent to $8.28 in Sydney. The stock has gained 39 per cent this year and has a market value of $6.3 billion. ''Crown is not cheap at current levels,'' said Owen. Packer raised $396 million last week selling his 21 per cent stake in investment manager Challenger Financial Services Group. Packer and Consolidated Press' Ashok Jacob today resigned from the board of Sydney-based Challenger -----------------------------------------------------------
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