CPH odds-on for Russia casino coup

James Packer’s private company Consolidated Press Holdings is expected to become the first foreign group to run a casino in Russia.

Fresh from breaking ground on its AUD 1.4 billion City of Dreams project in Macau, CPH is now understood to have signed an agreement with Russia’s Crocus Group, which is building a 24,300sqm casino at Crocus City, on the north side of Moscow, which bills itself as the largest luxury mall in the world.

The casino, at the intersection of the Moscow ring road and Volokolamskoye highway, will sit alongside an 80,000sqm hotel. Both are part of an expansion that will double the size of Crocus City and includes 15 high-rise office buildings, a yacht mooring terminal, helipad and 16-screen movie theatre. CPH is expected to be involved in managing both the casino and hotel.

Russian media, including business newspaper Vedemosti, initially reported that a deal had been struck between Crocus and PBL. But it is understood that the deal involves CPH, through which the Packer family owns its controlling stake in PBL.

The deal may involve Damian Aspinall, the British gaming heir with whom CPH has teamed to launch an assault on the British market. The Aspinall/Packer consortium is one of the leading contenders to build Britain’s first super-casino and is also launching a string of smaller clubs across England.

Mr Aspinall, whose father set up Britain’s first casino, recently said he and Mr Packer had been friends for more than a decade.

Vedemosti sourced its report to Emin Agalarov, commercial director of Crocus Group and son of the group’s president, Aras Agalarov, a multi-millionaire Azerbaijani real estate developer. Crocus builds luxury boutiques, exhibition centres and luxury residential buildings. Mr Agalarov Snr is Russia’s 84th richest man, with a fortune estimated at USD 540 million last year.

The agreement was confirmed by Sergei Riabokobylko, managing director of a real estate firm which consulted the companies on the project, Vedomosti said.

A PBL spokesman said the company had „no comment“ on the speculation.

CPH might wait until laws regulating gambling businesses in Russia were clarified, said Lavrentiy Gubin, a spokesman for Dutch-based Storm International, which manages casinos in Moscow. A Russian law on the regulation of gambling was yet to be enacted, the reports said.

PBL, which owns Perth’s Burswood and Melbourne’s Crown casinos, hopes to have its Crown Macau casino operating by next April, with City of Dreams schedule to open in 2008.

The company is partnering in Macau with Lawrence Ho’s Melco International, and they plan to be the world’s largest Asia-focused casino operator.

Ellerston Capital, the hedge fund group backed by CPH and operated by the Packers‘ investment chief, Ashok Jacob, is eager to capitalise on emerging-market opportunities in countries such as Russia and China.