Last year James Packer’s PBL paid around $91.8 million to buy the executive chairman’s interest in the UK casino joint venture with London rich kid, Damian Aspinall.
Aspinalls (or Aspers as the casinos are known) is the name of the venture and shareholders approved the move to issue James Packer’s private company with around 5.4 million PBL shares at just over $17 a share.
Judging by comments by Mr Aspinall in the the London newspaper, The Telegraph, at the weekend, the joint venture isn’t enjoying the best of times, with the best laid plans of the two tycoons having hit some rough water, courtesy of the British Parliament.
The Telegraph reported:
As one of the country’s most prominent casino owners, he [Aspinall] was a fan of the Labour Government’s plans to de-regulate the industry, which in his view were made up mostly of “third-rate gambling dens above fish and chip shops” badly in need of investment.
However, the Government’s plans have started to crumble over the past month. First, in the Budget Gordon Brown increased the amount of gaming duty that casinos have to pay – a shock move that will take £100m from the industry over three years.
Secondly, the House of Lords voted against the Government’s favoured locations for its new generation of casinos, specifically the proposed super casino in Manchester.
“It’s a shambles, an absolute shambles,” says Aspinall.
Nothing seems to ruffle his impeccable exterior, but he is clearly upset that plans for his Aspers company are being put in jeopardy. It’s a joint venture between himself and James Packer, his oldest friend and son of Australian billionaire Kerry Packer. It encapsulates the old-world, aristocratic Aspinalls club in Mayfair, founded by his father and the haunt of Lord Lucan, as well as a flashy new casino in Newcastle, where Wild Wing Wednesdays (free chicken wings at the roulette wheel) are the order of the day.
Newcastle has only been going a year or so but, by most accounts, is very successful, especially at bringing in a young crowd who wouldn’t usually gamble. “I passionately believe it is not just about gambling; it’s about having fun.”
He argues that you can’t stop gambling, so you might as well run the industry in as regulated and creative a way as possible. His problem is that the hike in gaming duty will wipe out all investment in the industry and stop people wanting to open sites such as Newcastle, with its bars, restaurants, beauty salons and putting greens.
“It’s insane. They spend years deregulating the industry and then overtax it.”
Funny, it’s a sentiment we haven’t heard from James Packer or PBL. But then the proposed purchase of the interest in Aspinalls from James Packer’s private company Ancarac, was described last year as not being ‘material’ to PBL.
It isn’t ‘material’ but James Packer got enough shares to tighten his control slightly on PBL and they are worth around $10 million more for an investment which looks like being profitless if Mr Aspinall’s comments about the increase in gaming duty wiping out ‘all investment in the industry’ are true.
All we hear about is casinos in Macau and now in Canada. Britain, it seems, is a write-off.
Just wait till the Victorian and WA Governments hear about that move by their fellow travellers in London: they won’t dare to increase taxes on Crown or Burswood.