After being tipped as a potential equity partner for Steve Wynn or for Phil Ruffin’s New Frontier (or for a Wynn buyout of the New Frontier), James Packer’s Publishing & Broadcasting Ltd. (PBL) has landed a Strip venture and it’s … none of the above. It’s buying a 19.6% chunk of privately held Fontainebleau Resorts.
It’ll cost PBL $250 million for that 1/5 piece of the action — a bargain (possibly even a steal) when you consider that the announced price tag for Fontainebleau-Las Vegas is $2.8 billion alone. This is a "something for everyone" deal, what with PBL, among other assets, having two casinos Down Under (anyplace that inspires Rachel Griffiths to emulate Lady Godiva is A Good Thing in my book) and 41% share of Melco PBL Entertainment … giving it a coveted slice of the Macao casino pie.
By latching onto Fontainebleau — and, by extension, CEO Glenn Schaeffer’s considerable experience and brainpower — PBL gets onto the Strip with relatively little financial exposure. Both companies bring operational expertise to the deal, obviously.
In Schaeffer’s case, anybody who could forever change the inveterate low-end image of Circus Circus Enterprises through Mandalay Bay is to be reckoned with. And, since Packer is going in without sometime partner Lawrence Ho’s Melco, he manages to keep the unwelcome specter of Stanley Ho a couple of arms-lengths away. That should placate Nevada gambling regulators.
This looks like a "win/win" and an infusion of interesting new blood into the Strip (with the added virtue of casino experience, which some would-be entrants conspicuously lack). Since James Packer’s late father, Kerry Packer, was a "whale" of notorious appetite for risk, non-Fontainebleau casinos will secretly be happy that the son is merely competing for their customers, not clobbering them in the pit the way Dad used to do.
On a sadder note … MGM Mirage has announced the April 12 death of Tracinda Corp. executive and MGM Mirage board member James Aljian. A former casino executive himself, Aljian was pretty tight with majority shareholder Kirk Kerkorian, going back to 1961, their association eventually encompassing the founding of the International (now the Las Vegas Hilton) and the original MGM Grand (now Bally’s-Las Vegas).
A three-decade Oscar voter, Aljian could also count service in the 3rd Infantry Division and as an Eagle Scout among his many accompishmnents. He leaves a widow, two siblings, three children and six grandchildren. His family is encouraging memorial donations to: The UCLA Foundation for the James Aljian Memorial Fund at the David Geffen School of Medicine, 10945 Le Conte Ave., Ste. 3132, Los Angeles, Calif. 9009.
