High Roller Takes Loss in Style

Kerry Packer is an outsize personality, a big, brash man known even in this capital of excess as a ferocious gambler and extravagant tipper who bets--and often wins--dizzying amounts.

So when Packer, a burly media tycoon who is one of Australia’s richest citizens, lost at the tables here recently, he did that too in almost unbelievably grand style.

Over a single July weekend, the 62-year-old billionaire dropped a reported $20 million, a loss so huge that, when it leaked out, it sent ripples through casino stocks on Wall Street and spurred heated political debate back home.

Packer acknowledges losing money during his visit here but says the sum was smaller (he won’t say how much).

Casino giant MGM Mirage, which owns the opulent Bellagio where Packer played baccarat that weekend, won’t comment; not surprisingly, casinos tend to be protective of their best customers, whether they win or lose. But other sources, from gambling industry insiders to Wall Street analysts who predict a bounce in the company’s quarterly earnings, believe the account.

Packer’s office declined requests for a personal interview last week. At home, though, he has rebutted criticism from Australian politicians that his gambling is irresponsible and morally offensive, retorting that he has given more to charity this year than he has lost at the green felt tables.

“This is not someone else’s money; this is mine, and I am entitled to spend it in any way I choose,” Packer said in an interview published Sept. 2 in the Australian, a national newspaper. “I understand that it’s a lot of money, and I understand how it comes as a shock to some.

“But the truth of the matter is that I like to have a bet every now and again.”

No one would quibble with that here.

In this town of big spenders and over-the-top characters, the news of Packer’s gigantic loss seems, oddly, only to have burnished his legend. Already reputed to be one of the biggest winners in Las Vegas history--he reportedly took the MGM Grand for more than $20 million in 1995--he is admired now for his ability to take an equally staggering hit.

“Packer is the biggest of them all,” said Peter Ruchman, longtime manager of the Gambler’s Book Shop, a comfortably dusty hangout and bookstore specializing in Vegas’ favorite subject. “He’s got more money than a lot of the casinos.”

Considered the highest of the Strip’s top high rollers--or “whales”--Packer is a formidable gambler, both feared and sought by the casinos he frequents. He likes baccarat and blackjack, and he plays hard and extremely fast, betting up to $250,000 a hand, several hands at a time.

“He’s a very dangerous player, perhaps the most aggressive table games player in the world,” said Max Rubin, a Las Vegas author, gambling company consultant and onetime dealer who has watched Packer play.

He gambles for short stints, a few hours at a time, making him even more threatening to a casino’s bottom line. If he gets ahead, he’s out the door before the house has a chance to recover.

A tall, heavy-set man with a bullying style, Packer also enjoys “putting a little fear” into the casinos, said a former casino executive who knows him well. “If there’s a football game on, he’ll ask, ‘Would you let me bet $1 million on the game?’ It’s just mad money to him.”

Occasionally, he even telephones Australian casinos when he’s flying overhead, inquiring how much money they have in the cashier’s cage. “If it’s enough, say $300,000, he’ll stop and try to clean them out,” said the former executive, who spoke on the condition of anonymity, citing his relationship with Packer.

Then there’s the prodigious amount he can afford to lose.

The Australian’s net worth from a vast empire of television, newspaper and magazine holdings is put by Forbes at $3.8 billion, making his recent loss, in his terms at least, practically pocket change.

Along with his Sydney-based private flagship, Consolidated Press Holdings Ltd., Packer and his family control about 45% of Publishing and Broadcasting Ltd., which owns Australia’s largest commercial television station, Channel Nine. Other investments include film studios and Australian casinos.

He visits Las Vegas three or four times a year, and London’s gambling houses even more often. His credit line here is $20 million, the largest in Las Vegas, according to industry insiders.

He’s known as a flamboyant tipper, generous when he loses, extravagant when he wins. In Vegas parlance, “Packer is a George with a capital G,” says Chuck Di Rocco, the publisher of the weekly gamblers’ newspaper Gaming Today.

Playing baccarat at the Mirage Casino and Resort in 1989, for instance, Packer placed a $100,000 bet for the dealers, said Rubin, who was working at a roulette table that night. “It was shared among the dealers, and everyone got a few thousand,” Rubin said.

In one of the most frequently told stories, Packer bought a car--either a Mercedes or a BMW--during a Vegas visit and gave it to a parking valet before he left. Another time, he paid off the $130,000 home mortgage of a cocktail waitress who was deeply in debt.

Casinos’ Bottom Line Said to Be Affected

Other tales about him abound--from his survival of a 1990 heart attack that left him clinically dead, to his reported status, according to trial testimony, as one of the better-known clients of former Hollywood madam Heidi Fleiss.

Now, adding to the lore, is his apparent power to change the fortunes of a giant company.

On July 14, Packer reportedly arrived at the Bellagio, the current favorite here of the world’s wealthiest gamblers. Ensconced in the casino’s semiprivate baccarat salon, a hushed zone of deep greens, light-toned woods and Chinese porcelains, he is said to have lost millions almost immediately and was unable to win it back throughout the weekend.

The first, brief report of the loss appeared three days later in a column by gambling writer Dave Berns in the Las Vegas Review-Journal. Then it was all but forgotten, surfacing seven weeks later on the front page of the Australian and launching a national debate.

“Notions of public morality and justice are under threat when it is possible for one person to accumulate such extraordinary wealth and then use it in such an extraordinary way,” fumed a frequent Packer critic, Labor Party lawmaker Mark Latham, according to Australian news accounts.

“If someone has enough money to blow $34 million (Australian dollars) at the casino, then they have enough money to pay more tax and help build a better society,” Latham said in the attack from the floor of Parliament. (The amount was equivalent to $20 million in U.S. currency about the time of the loss, although it has fluctuated since then.)

Packer fired back, granting a rare interview to Dennis Shanahan, the Australian’s political editor. The media magnate acknowledged his gambling loss but declared it “a fraction” of the figure reported--and less than his charitable contributions to the New Children’s Hospital in Westmead, Australia.

Debra Fowler, a spokeswoman at the hospital, said Friday that Packer gave $10 million in Australian dollars--about $5.4 million U.S.--to the charity this year.

Packer also said he and his corporation have paid plenty in taxes--totaling more than $2 billion in Australian dollars (1.08 billion U.S.) over the last 10 years.

“When politicians start becoming moral judges on what people can spend their money on or not, is something which sits better in a Stalinist state than it does in this country,” he said.

Prime Minister John Howard even entered the fray, defending Packer’s right to spend his own money however he chose.

Then, Wall Street reacted.

Several analysts raised their estimates for MGM Mirage’s third quarter earnings, saying the loss, combined with other factors, may translate to a jackpot for the company.

Jeffrey Logsdon, an analyst at W.R. Hambrecht & Co., said he has upped his quarterly earnings estimate for the company from 32 cents a share to 38 cents. That was based, he said, on Packer’s reported loss, on accounts of a second high roller dropping at least $5 million at the same casino, and on the overall strength of the Las Vegas economy.

“Two people apparently lost a significant amount of money at the Bellagio in July,” Logsdon said. “This presupposes that Packer or others didn’t win it back the next day, but about half of those big gaming wins could fall to the company’s bottom line.”

PaineWebber gaming and leisure analyst Robin Farley also estimates that Packer’s loss could add 5 to 7 cents a share to the company’s quarterly earnings.

MGM spokesman Alan Feldman said he could not comment on reports of the loss or whether Packer had been in town any time recently.

But he said it was “very unusual” for anyone’s reported winnings or losses to be seen as affecting the company’s bottom line.

“In fact, I don’t really remember such a time,” Feldman said.

As the dust settles, the talk in Las Vegas now is of how soon Packer might return to try to recoup his losses, at the Bellagio or another of the Strip’s high-roller haunts.

No one doubts, however, that he’ll be back.