According to a headline in the Sydney Morning Herald, Crown Resorts was “shuffling the deckchairs” last week as it waited for the release of the Bergin report, a year-long review of its suitability to run a casino resort in the Australian city.
The review, under the oversight of former judge Patricia Bergin, was sent to the New South Wales Independent Liquor and Gaming Authority (ILGA) on February 1. But it may be two weeks before the contents are revealed to the public and Crown executives.
These are tense times for Crown, which came under scrutiny following an investigation that suggested money may have been laundered through its casino bank accounts; those allegations sparked an investigation by the financial crime watchdog AUSTRAC in a probe that is ongoing. The embattled company also has faced allegations of ties to organized crime.
Depending on the findings of the Bergin study, Crown could see the revocation of the gaming license at its new US$2.2 billion resort in Sydney’s Barangaroo section, or at the least the imposition of strict operating conditions. James Packer’s company originally planned to open the multibillion-dollar Crown Sydney resort in December, but was prohibited from opening the VIP casino that is its centerpiece. The Sydney Crown Towers hotel, bars and two restaurants opened on January 8 under an interim license that must be renewed in May.
Meanwhile, in an effort to rehabilitate itself in the eyes of lawmakers. Crown is shuffling its executive and board ranks. The company recently announced the appointment of former SkyCity Entertainment Group CEO Nigel Morrison as a new non-executive director. Pending regulatory approvals, Morrison will replace John Horvath, who agreed to exit the board after shareholder voted against him at the company’s annual general meeting in November, and could eventually replace Crown CEO Ken Barton, described by The Age as “a dead man walking.”
In addition to his time as CEO of New Zealand’s SkyCity Entertainment Group, Morrison served as group chief financial officer of Galaxy Entertainment Group in Macau. He has also served as CEO of the Federal Group, owner and operator of Tasmania’s Wrest Point casino, and as chief operating officer of Crown Melbourne Ltd.
“Nigel’s extensive experience in the Australian and New Zealand casino industries as chief executive officer of SkyCity together with his senior leadership positions in other major casino companies in Australia and Macau will strengthen the board in a constantly evolving operating environment,” said Crown Chairwoman Helen Coonan. “The board welcomes Nigel’s contribution as we continue to implement our reform program and deliver on our other strategic objectives.”
According to Inside Asian Gaming, at the November meeting, Coonan said shareholders sent a clear message that board renewal was required in the wake of the current review.
As reported by Inside Asian Gaming, Crown’s troubles in New South Wales have had a ripple effect in Victoria. The Victorian Commission for Liquor and Gambling Regulation revealed late last year that it would hasten the next review of Crown’s casino license to operate Crown Melbourne, the flagship property that opened in 1995.
Meanwhile, Crown rival Star Entertainment is likely to benefit from delays to the Sydney casino, J.P. Morgan said in a report.
