Packers Big Gamble on Gambling

James Packer's multi-billion dollar punt on the Asian gambling mecca of Macau hit another milestone this week with the opening of his City of Dreams Casino.

Two years ago James Packer inherited over $6 billion from his father Kerry and has since set about putting a personal stamp on the family's empire. That stamp has substantially involved divesting ownership in the media holdings upon which the Packer empire was built, and moving aggressively into gambling interests.

And the cornerstone of this shift in strategy is City of Dreams. A $3 billion mega casino situated in Macau's main strip that he co-owns via joint venture vehicle Melco Crown with Lawrence Ho (son of Stanley Ho).

City of Dreams opened this week amid great fanfare and a star studded guest list and it's a megga-casino by anyone's measure.

It sits in prime position, across the Cotai Strip from the world's largest casino, The Venetian. Over forty thousand square meters of floor space, two thousand tables and gaming machines, three hotels, an entertainment and restaurant mall, all situated in a gambling precinct that turns over more money than Las Vegas and Atlantic City combined.

When dirt was first turned at the City of Dreams Casino site a couple of years back, Packer and partner Lawrence Ho were probably a little more optimistic at the casino's prospects. Packer was worth over $6 billion, Chinese citizens were flooding to Macau in record numbers and spending record amounts and the world economy generally was humming along.

Now, Packer's net wealth has halved, China has imposed visa restrictions on their resident's travel to Macau and money generally has dried up around the world. His big gamble is looking bigger than ever.

Analysts are calling it a sink or swim play, while JV partner Lawrence Ho has said that if the casino doesn't perform as hoped it will be Melco Crown 's 'endgame'.