Packer, CBA, The Age and Sing Inc

5. Fawning Packer letters to The Bulletin

By Stephen Mayne

Compared with the riveting 100-page tribute issue to Kerry Packer, this week's edition of The Bulletin is a pedestrian 76-page effort with just eight pages of paid advertising.

With the old man now gone, you have to wonder if James Packer will be prepared to continue taking the losses from publishing the magazine which are estimated to be about $10 million a year.

The most interesting aspect of this week's edition is the letters pages, which certainly had a far more positive tone than what readers of the Murdoch and Fairfax papers thought of Australia's richest man. Try these for size:

I have it on good authority that Kerry's not dead. He's just gone into partnership with God – Chris Hayward

The topographic and topophilic equivalent of Kerry Packer dying is the removal of Ayers Rock from the Australian landscape – George Poulos

I love gambling, and I have always had this wonderful fantasy where one day Kerry Packer and myself would be sitting on the same table playing blackjack and we'd be swiping the pants off the dealer. I salute you Kerry Packer – Carmela Bowles, California

I enjoyed reading your write-up about the great man and my mentor. I follow cricket as a philosophy. Thanks to the late Kerry Packer we now have a competitive and lively game of cricket for our grandkids. I admired his creative business ideas, skills and vision – Ajith Amarasekera

At least they allowed one sledge of The Bulletin's indulgent albeit fascinating coverage:

Whilst I agree that Kerry Packer has a place in the history of our country, I cannot believe that your issue of January 4, 2006, represents all that has happened of importance since your last issue of December 5, 2005 – GN Robinson

Surprisingly, no letters got a run talking about the darker side of Kerry, like his belief that paying $200,000 to shoot an elephant in Botswana is good fun. And there was no mention of his extraordinary generosity in transferring $10 million in assets to his mistress, Julie Trethowan.

Interestingly, it appears Kate McClymont's story about this generosity in The SMH was first presented two days after Packer's death but there was quite a bit of nervousness on the newsdesk about running it.

The rumour in the newsroom was it was held up by strong objections from one board member who wanted the story pulled and contributed to the nine-day delay until Saturday, January 7. Now who could that have been? Surely not the Fairfax board member pictured next to James Packer on page 32 of The Bulletin's tribute issue.

Then again, this sounds a bit dubious because Fairfax board members don't normally know about stories before they appear and the editorial bosses might simply have decided the story was in poor taste to run straight after Packer's death. And with lawyers involved, it probably took Fairfax a few days to conclude that the "mistress" word would not be used.

6. Kerry Packer, the Texan, the toss and the truth

By Stephen Mayne

If there is one story which sums up the legend of Kerry Packer better than any other, it's the tale of the big man saying "toss you for it" to a Texan in Las Vegas who gloated about how much he was worth in an attempt get some more attention.

But the actual amount, the source of the Texan's wealth and the circumstances differ across publications around the world. Here are some of the conflicting tales:

"He was, more remarkably, once reported to have won 20 hands of baccarat in a row at Las Vegas. There, a Texan oilman at Packer's table brashly announced he was worth $US60 million. 'Toss you for it,' came the laconic reply." – Daily Telegraph, London

"He once overheard a Texan oilman bragging that he was worth $US100 million. Packer said simply, “I'll toss you for it” — and the American walked away." – The Sun, London

"He famously offered to toss a coin for the $US50 million a Texan oil magnate, who was annoying him at a roulette table, had bragged to be worth." – The Racing Post

All of these are wrong in some respects. However, the story from the mid-to-late 1990s is clearly true as the CEO of Mirage Resorts, Bobby Baldwin, explained in this exchange with the Las Vegas Review Journal's Norm Clark two days after Packer's death:

The story about the Texan? "True," Baldwin said. Packer was at one table and the Texan, playing one table over, wanted some bigger action. Packer turned him down. "The other guy said, 'I'm a big player too. I'm worth a hundred million.' "Kerry said, 'If you really want to gamble, I'll flip you for it (the $US100 million).' " The Texan quietly went back to his game.

And we now even appear to have the Packer side of the story as The Bulletin's tribute issue included the following quote from Kim Beazley:

Beazley remains fond of another story Packer told him about his days as one of the world's biggest gamblers. "He was gambling in Las Vegas and there was a Texas cattleman who grew quite resentful of the favoured treatment that Kerry was getting. Eventually this cattleman approached him and said, 'Do you know I'm worth $US70 million?' And Kerry looked at him and replied 'I'll toss you for it."

If Kerry himself and the the CEO of the casino can't agree on the amount involved, what hope is there? Surely some enterprising journalist will be able to track down the said Texan to establish whether he made his money in cattle or oil, how much he claimed to be worth and what exactly happened at The Mirage that night.

Patrick Cook has extended the story somewhat in a satirical column in The Bulletin this week that went as follows:

Rich stories abound about Kerry feats of gambling. One such popular legend concerns a loud-mouthed Texan in Vegas who skited that he was worth $70m. With the shy smile for which he was notorious Kerry murmured: "Toss you for it." The Texan tossed and lost. With a twinkle in his eyes, Kerry handed the oaf his hat and said: "Now get off my f*cking land."

7. CBA streaks ahead to a new record

By Stephen Mayne

Shares in The Commonwealth Bank soared 59c yesterday and with the stock up another 17c to an unprecedented $44.04 this morning, it appears to have set a record for market capitalisation of an Australian bank whilst extending its valuation lead over the National Australia Bank to more than $4 billion.

As you read this, CBA is capitalised at a staggering $56.75 billion, $4.5 billion clear of NAB which has dipped 5c to $32.41 this morning and is capitalised at $52.25 billion.

The CBA valuation today appears to be an all-time record for an Australian bank, because when NAB hits its record high of about $36.50 in mid 2002, its market valuation peaked at about $56 billion. Back then CBA was only worth about $44 billion, so we've seen a $16 billion turnaround in the relative valuation of our two biggest banks over the past three and a half years.

Like CBA, ANZ and Westpac both hit record highs yesterday and with ANZ capitalised at $44.7 billion and Westpac $42.5 billion, the Big Four are now worth a record $196.2 billion. It won't be long before the magical $200 billion figure is reached and all of this comes from gouging the bejeezers out of Australian consumers.

CBA first briefly took the biggest bank title in 2004, but it was $2 billion behind NAB as recently as last September. So the departure of long-serving CEO David Murray has certainly not held back the bank, which was privatised in 3 tranches during the 1990s for just $8 billion.

All of this will provide plenty of food for thought at the NAB AGM in Sydney on 30 January. My annual report and notice of meeting showed up this morning and the cover is emblazoned with "New Thinking New Actions".

So exactly how are they going to reclaim the mantle of Australia's biggest bank? The rise of the CBA, combined with the fact that NAB has relocated is forex trading operations to Sydney, once again demonstrates how Sin City is the clear financial capital of Australia, whilst Melbourne's manufacturing heartland continues to shrink, Kraft's closure of its biscuit factory in Broadmeadows being the latest example.

17. Is anyone awake at The Age?

By Stephen Mayne

It is bad enough that The Age is still running its abbreviated business section on the back of the main part of the paper during the summer slowdown, but this morning's effort in re-publishing a story that was literally more than a month old is just not good enough.

Tabcorp told the ASX it was pulling out of the tender to build Singapore's first casino on 8 December and then PBL announced its withdrawal on 3 December. So how on earth can The Age publish a story on page 18 today which begins as follows?:

PBL won't gamble on Singapore
By Colin Kruger, Sydney
January 12

The Packer family's Publishing and Broadcasting Ltd is expected to announce as early as next week that it will not bid for the casino resort being proposed for Singapore's Sentosa Island.

Yesterday, Tabcorp revealed it would not bid for the Sentosa project and it is believed that an announcement by PBL and its Asian venture partner, Stanley Ho's Melco International, will be made once the partners meet and formally agree to abandon the project.

The clowns have even put it on their website today as if the story is new. Bet it won't be there by 3pm this afternoon.

At least The Australian is producing some fresh Packer material with John Lehmann's story today about some executive shuffling at Consolidated Press last year. However, the big issue is future executive changes when James Packer presumably has a free hand to deal with a few old MOKs (mate of Kerry) who aren't MOJs (mate of James).

The likes of Sam Chisholm, Graham Richardson and even The Bulletin's tired old speculator columnist David Haselhurst fit into this category.


23. Sing Inc gets one back over Branson

By Stephen Mayne

Singapore Inc haven't had too many set-backs as they've accumulated a $200 billion-plus government investment pile around the world, but one such disaster was the $600 million loss Singapore Airlines suffered on its Air New Zealand play after Ansett collapsed in 2001.

There was much Singapore anger towards Richard Branson when he ripped up a cheque for $250 million from Air New Zealand in rejecting an offer to take out Virgin Blue one week before September 11. This would have saved Ansett's bacon.

Famously, Ansett collapsed within ten days and Branson turned his $10 million Virgin Blue investment into a $1 billion profit by filling the void left by the fallen duopolist.

Ansett's owner, Air New Zealand, subsequently had to be bailed out by the Kiwi taxpayer and Singapore Airlines took a $600 million hit on its foray across the Tasman. Branson up $1 billion, Singapore down $600 million was not an equation the ruling Lee family enjoyed.

Well, Sing Inc clawed a little bit back yesterday when Optus, controlled by Singtel, bought out Virgin from their struggling Australian mobile joint venture. The Branson empire has admitted to a $20 million hit on the deal, which is still small beer in the broader scheme of things.

Sing Inc has dropped billions after spending about $14 billion on Optus but they are clearly prepared to go in deeper with further talk that a $1 billion bid for AAPT is on the cards.

With more than $20 billion committed, the Singapore Government has more invested in Australia than anywhere else and that will only increase if their $10 billion bid for P&O succeeds, because the British company has a very large Australian business, including the other half of the lucrative stevedoring duopoly it shares with Chris Corrigan's Patrick Corp.

All that carry on about executing Van Nguyen has clearly not dulled Sing Inc's enthusiasm for Australian assets.

Copyright © 2022 The Mayne Report. All rights reserved

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