James Packer’s Sri Lanka casino faces delay

James Packer’s Sri Lanka casino faces delay

October 23, 2013 – 4:21PM

Colin Kruger

James Packer’s plans to build a $400 million casino resort in Sri Lanka face further delays after opposition by religious leaders and politicians in Sri Lanka forced the government to alter tax concessions granted to Crown Resort’s consortium. The changes will delay the passage of legislation granting tax concessions to the project. The legislation was originally scheduled to go before parliament this week.Lakshman Yapa Abeywardena, Investment Promotion minister, said the decision to alter the deal’s terms came after various opposition politicians said Packer was getting concessions not given to local entrepreneurs and Buddhist leaders said the casino could be detrimental to Sri Lanka’s culture.

“We’ll amend the bill” and have new terms by November 21, Mr Abeywardena told reporters. “We will describe how we are going to grant tax concessions, like if it is from the gross revenue or net revenue. We will base the tax on the gross revenue and not on the net profit. The tax concession is on investment and not on the hotel operation. We will clarify all these in the new gazette.”

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Crown acknowledged the delays and indicated it is still pursuing the project.

‘‘Crown Resorts understands and respects the decision by the Sri Lankan Government in relation to the gazettal debate,’’ said a company spokesman. ‘‘Crown will continue to work constructively with the relevant government authorities to complete the necessary approvals related to the establishment of an Integrated Resort in Sri Lanka.  We look forward to the parliamentary debate in the near future.”

The ministry over the weekend released photos of Mr Packer meeting officials in Sri Lanka and Mr Abeywardena said he had asked Mr Packer to invest more in the country.

“He said he was willing to bring more investments. He told us he will consider some more investments along with this investment, but we have clearly told him we would not allow investments for more casinos,” the minister added.

Last week Crown publicly confirmed its interest in the project for the first time.

“A Crown integrated resort would help redefine luxury tourism in Sri Lanka and play a significant role in helping to drive increased international in-bound tourism, especially from India and China,” Mr Packer said last week.

The deal has already been delayed once after the government asked Lake Leisure Holdings, the joint venture between Crown and its local partner, Rank Entertainment Holdings, to change its construction plans.

Mr Packer’s deal has been already approved by the island nation’s cabinet and is expected to easily win approval from the parliament because President Mahinda Rajapaksa’s ruling coalition has more than a two-thirds majority.

with Reuters

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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