Alexander backs Packer at government inquiry
Former Crown Resorts chief executive and chairman John Alexander has defended James Packer before the New South Wales government’s inquiry into the casino operators’ suitability to hold a casino licence in the state.
The Age reports Mr Alexander told the inquiry that Mr Packer has “always been strong with his views, but they rarely led to direct actions in terms of personnel doing specific things.”
In the past four financial years running Crown, a period marked by mediocre share price and financial performance, Mr Alexander has earned $3.5 million per year in at-no-risk base pay alone.
That is before options and incentives and complimentary privileges at Crown Melbourne and Perth.
It was Mr Alexander who emailed Mr Packer in July 2019 to say The Age reporter Nick McKenzie’s investigation into Crown’s links with questionable Asian junket operators was “nonsense”.
Of course, this nonsense prompted the Crown board to issue a full-page rebuttal in News Corp newspaper that many directors now seem to regret.
And it is the same nonsense that turbocharged the New South Wales inquiry which has put Crown’s Sydney licence in jeopardy.
Most companies facing the allegations outlined in McKenzie’s investigations would have hired some semi-friendly figure to conduct an inquiry.
Mr Alexander didn’t do that, instead hoping his strategy to deny and drop stories to friendly journalists at The Australia.
“I could have chosen my language better,” he conceded at the inquiry.
Mr Alexander also entered the pantheon of great corporate equivocators last week when he was unable to explain Crown’s risk management and corporate governance shortcomings in the period before 19 employees were jailed for breaking Chinese laws.
“I can’t explain how it occurred,” he told the probity inquiry. “It’s clearly just a failure for the information to flow upwards.”
Packer pulls rank over Melco sale, inquiry heard
A New South Wales government inquiry into Crown Resorts’ suitability to hold a casino licence in the state continued this week, where James Packer was alleged to have pulled rank over his proposed deal with Melco Entertainment.
The Brisbane Times reported in September that one of Packer’s key lieutenants has admitted he should have done more to investigate whether or not selling a $1.7 billion stake in Crown Resorts could jeopardise the group’s Sydney casino licence.
The inquiry heard on Monday that Mr Packer insisted on the agreement to offload a 19.9 per cent stake in Crown to Hong Kong group Melco, telling one of his executives: “It’s my life and I’m going to overrule you.”
The inquiry is investigating whether Crown’s agreement to sell 19.9 per cent of its shares to Melco breached its casino licence by giving Macau casino kingpin Stanley Ho an indirect interest in Crown.
Mr Ho and a list of associated individuals and entities are banned from being involved in Crown’s Barangaroo casino because of long standing alleged linked to organised crime.
Crown director and executive of Consolidated Press Holdings Michael Johnston told the inquiry on Monday he presented Mr Packer with a number of options to sell some or all of his 46 per cent stake in Crown in May last year.
By May 23, Mr Packer had settled on a sale to Melco, telling Mr Johnston via text: “Mike, it’s my life and I’m going to overrule you.”, the inquiry heard.
Mr Johnston told the inquiry he phoned Crown’s then-executive chairman John Alexander late on the night of May 30 to inform him of the Melco deal.
Mr Alexander had just stepped off a plane in Los Angeles, where Mr Packer lives, and “didn’t sound happy with the news.”
He said that was because the deal was a partial sale of Mr Packer’s shares rather than a full takeover of Crown, which Mr Packer had previously discussed with US casino group Wynn Resorts.
“Mr Alexander’s voice was very flat, which is understandable because if we had something like the Wynn transaction, he would have benefited quite handsomely under his executive remuneration plans, given he had share options,” Mr Johnston said.