The new boss of the Australian dynasty is likely to move the firm out of newspapers and into casinos. James Packer, son of Kerry Packer, who died on Boxing Day leaving a A$7 billion (£2.9 billion) fortune, plans to stamp his name on the Australian media dynasty by embarking on a global hunt for top-quality gambling assets.
Baccarat and Blackjack were the card games Mr Packer enjoyed most and he journeyed around the world to indulge. In 1995 at the MGM Hotel in Las Vegas he had the Baccarat section closed and played eight tables alone, wagering between $250,000 and $500,000 a hand.
Within days of his 68-year-old father´s death, Packer junior was back in his Sydney office reportedly planning a bid for Tabcorp, Australia´s most prestigious casino operator.
The move marks a shift away from the media interests on which the Packer empire was built - Packer´s Channel Nine is Australia´s top-rated TV network. The Australian press last week claimed that James´s first act on filling his father´s shoes would be to sell Nine, although this was rejected by Packer´s office.
Gambling, however, does look set to become the central theme of his worldwide strategy. James has in recent years been pushing the gaming interests of Publishing and Broadcasting Limited (PBL), the family company his father inherited 30 years ago as a A$100m private firm and built into a listed media colossus capitalised at about A$14 billion.
PBL today owns the Crown casino complex in Melbourne, the Burswood casino in Perth, and last year invested in a big casino in Macao. PBL´s gambling assets now deliver 40% of underlying profits while its media interests, which include a stable of best-selling women´s magazines, have suffered.
Tabcorp would be the ultimate catch for the Packer empire, not least because it would deliver a nationwide Australian gambling franchise and provide the springboard for a full-scale tilt at the lucrative Asian gambling sector. Shares in Tabcorp rose 12 cents to A$15.56 on Friday, adding to a 27 cent gain the day before, on news of the bid rumour.
The owner of Sydney´s glittering Star City Casino and Queensland´s Jupiter casinos, Tabcorp operates nearly 18,000 gaming machines in 270 licensed clubs and hotels.
Tabcorp´s success is based on the millions of Asian gamblers who visit Australia each year, a market the Packers have always been eager to exploit. James, 38, visited Macao last year to assess the gambling opportunities in China. He is also thought to be eyeing British gaming assets.
David Harrison at financial-services group Macquarie Equities in Sydney, said: "A purchase of Tabcorp makes sense. Tabcorp would make a very comfortable fit with Crown. It would give PBL a national casino network. The regulators would, of course, want to have a look at any bid."
Sydney´s investment community last week gave the thumbs up to James´s ascension to the Packer throne, defying the pundits who expected a 10% collapse in PBL?s share price after his father´s death. In the event it fell a mere 1.3% on the Monday after the news, before recovering mid-week. "It was a strong vote of confidence in James," said one analyst.
Harrison, who dismissed claims that James is ill-equipped to manage the empire, said: "He is very confident and very capable."
Questions, however, hang over James´s precise role in the collapse of One Tel, the Australian telecoms company in which the Packers were key shareholders and which swallowed A$300m of the family fortune two years ago.
James was on the board of One Tel, but claims he was not responsible for the loss of hundreds of millions of dollars of shareholders´ cash. The inquiry into the case is still running, and Packer last month gave evidence before a hearing into the collapse.
The Packers - father and son - were also involved in a disastrous attempt to set up a telecoms and new-media company in India, which failed with huge losses. And their main Australian internet asset, Ninemsn.com.au, has never made money.
Nor are their media interests performing to expectations, with Channel Nine repeatedly generating lower returns - with lower ratings.