After a painful loss due to Australia’s new tax policy, Crown scores a deal which will prove profitable on the long run.
The Independent Liquor and Gaming Authority of New South Wales (NSW) is conducting a mandatory investigation to see if Crown Resorts Ltd are fit to operate a casino under Australian gambling laws, after the company received approval for a new luxury resort in the inner-city suburb of Barangaroo, Sydney.
Standard procedure requires a formal investigation and call for public submissions regarding the new license. According to the Australian gambling authority, the investigation should be completed in March 2014. However, the company won’t be allowed to move forward with its plans until November 2019.
Crown’s new project includes a six-star luxury hotel resort with a VIP gaming facility. Currently, rival casino operator Echo Entertainment Group runs the only existing casino in NSW, under an exclusive license which expires in 2019.
Pecker loses $400 million, as taxes increase
Earlier in December, Crown reported a major loss due to a new tax policy which affected all Australian poker rooms. Financial experts then calculated a tax liability of $184 million for the company and a $400 million loss for its chairman, James Packer, after share prices dropped by 6.5%.
It was then that Packer announced he’d be picking up negotiations with representatives of the Australian government, to discuss the conditions of Crown’s license and new tax arrangements. The company owns and runs two major gambling venues in Australia, which add $2 billion to the country’s economy.