Packer siblings settle for peace
James Packer has made peace with his sister Gretel and agreed to give her total ownership of the family’s Ellerston pastoral property in the NSW Hunter Valley, after a bitter falling-out between the siblings over negotiations to carve up the Packer family fortune.
Mr Packer reveals in a new biography on his life, The Price of Fortune, that he and his sister have struck a final agreement that resolves all obligations between them, ending discussions to settle Kerry Packer’s will that stretched over almost three years and were — at times — deeply acrimonious.
In early March, weeks before Mr Packer publicly resigned from the board of his casino company Crown Resorts to deal with his mental health issues, he and his sister resolved to make peace.
Their mother, Ros, is said to have played a key role in the reconciliation when she visited her son in Aspen in the first part of the year.
“My sister and I have made up,” Mr Packer says in the biography. “I want to thank David Gonski, Matthew Grounds and my mother for helping both Gretel and I make peace. I’m so happy. I love my sister.”
Mr Gonski is an executor of Kerry Packer’s will, alongside Melbourne businessman Lloyd Williams.
Matthew Grounds, the Australasian head of investment bank UBS and a long-time adviser to James Packer, played a role in early negotiations between the siblings to divide the family fortune.
Gretel Packer was advised in the negotiations by Caledonia Investments chief investment officer Will Vicars and Sydney financier Michael Triguboff.
In her first public comments on the financial separation from her brother, which made her a billionaire in her own right, Ms
Packer says in the biography: “I love my brother very much and am very happy that he and I have been able to negotiate this settlement.
“I don’t think there was ever going to be an ‘easy’ time for us to do this and it was always, more likely than not, going to be difficult. The short-term easier option would have been to leave it for our six children to work out … and that would have been unfair to them and lazy of us.
“The fact that we didn’t take that route is something I think we should both be proud of.”
The first agreement between the siblings, struck in September 2015, was reportedly worth $1.25 billion and included a lump sum of more than $200 million.
Ms Packer and her children also received a series of smaller secured cash payments over the coming years and retained a minor residual interest in the Packer family company CPH.
On Christmas Day 2015, a revised $1.25bn deal was agreed, running over a shorter timeframe, which helped Mr Packer reduce his substantial personal debt position.
Ms Packer reportedly emerged with stakes in Crown and US online real estate company Zillow, as well as cash holdings, a residual interest in CPH and ownership of the Packer family’s long-time seaside retreat at Palm Beach, north of Sydney.
The recast deal also gave Ms Packer a one-quarter share of Ellerston. The biography reveals that it was during negotiations over Ellerston that the siblings really fell out.
Mr Packer now says he has deep regrets about the dispute but wants to make clear that his actions in the negotiations were better than his words.
“Even though we have a framework arrangement that spans many years, I separately arranged, without obligation, to make funds available to Gretel and her children early,” he says.
“To do that put me under financial pressure.
“I accept at times my words were unforgivable to Gretel and Will. I hope my actions were better than my words. I can under- stand my sister wanting to be bought out. I can understand my sister saying: ‘James, Will Vicars is going to be a better custodian of my money than you.’
“I just wish we had all done it better, and I certainly take my share of the blame for that.”
Under the final agreement between the siblings, which included some assets and other property, Ms Packer will eventually move to take 100 per cent control of Ellerston.
She also took ownership of Kerry Packer’s super yacht, the Arctic P.
In an announcement to the Australian Securities Exchange last year that it was selling its interest in Ellerston back to the Packer family, Crown revealed its 50 per cent stake in the property was valued at $62.5m.
This price implied Mr Packer’s 25 per cent stake was worth about $30m, meaning Ms Packer agreed to pay about $90m to take full ownership of the property.
“Ellerston is a painful subject for me,” Mr Packer says. “Gretel has exclusive rights to it now and in the future will own it 100 per cent. It is where my father is buried. Will (Vicars) and Gretel won it from me.”
But he says allowing Ellerston to be in the deal with his sister was the price he had to pay for reducing his debt and allowing him to keep his half-share of Crown.
“My father once said to me, ‘Son, the problem with the English is they sell their businesses to keep their properties. Sell your properties to keep the business,’ ” Mr Packer says.
After a nasty falling-out with Mr Vicars during negotiations, Mr Packer says he has also agreed to make peace with a man he now describes as a “formidable negotiator”.
Mr Vicars agrees it was a long, drawn-out, emotional process negotiating the division of a whole range of assets that were dear to the hearts of both siblings.
“A lot of things were said that both sides wish were never said, but that’s what can happen in the heat of the moment,” he says in the biography. “That moment went on for quite a while.
“At the end of the day, everyone is now talking again; the emotion has washed through.”