Perpetual’s Echo Stake Increased by Regulators

Perpetual Investment Management has been granted an increase its in voting power over Echo Entertainment Group, allowing the investment firm to increase their stake to as much as 15 percent of the casino’s operations.

Regulators from the NSW Independent Liquor and Gaming Authority, as well as the governing Queensland ministry, approved this, which can also meant that other shareholders of the casino might gain the same approval as well.

In a statement released by Echo, the company also said that a shareholders’ restriction that is stipulated in its constitution, where a person with voting power is required a written consent from the gaming authorities, is already overridden.

But reports also say that last June 22, Perpetual Investment Management formally informed the Australian Securities Exchange that it was no longer a shareholder with Echo. Perpetual has refused to make a comment about this and about where it stands in relation to its current interest with the casinos.

Then there is also a question of whether or not Perpetual would build a blocking state, and if a 15 percent stake is enough to do this, should it pursue its interest with Echo.

Some analysts say that it’s not known how Perpetual will make their move after this, but the changes does make Perpetual an important player in all this.  Additionally, the new development definitely poses a precedent for other shareholders.

Echo Entertainment Group manages several casinos all across Australia: the Treasury Casino in Brisbane, the Star Casino in Sydney, and two Jupiters Casino located in the Gold Coast and Townsville respectively.

James Packer’s Crown owns at least 10 percent of the stake, while Genting, a Malaysian company owns about 9.88 percent. These investors are waiting to hear if the regulators will also lift their stakes, as it did with Perpetual.