James Packer-backed Ellerston raises stake in casino rival Star

The fund already had an interest in The Star, after buying into it in March, and it appears to have topped up its interest through Genting Group’s exit from the casino operator.

Genting, a Malaysian tourism and gambling giant, last week sold 6.4 million shares in The Star at $5.07 in a block trade, giving it a net gain of $67.5 million on its investment.

Mr Packer, who owns rival casino company The Crown, has a 25 percent interest in Ellerston through his private investment vehicle Consolidated Press Holdings. Mr Packer is a passive investor in the fund and any move on his casino rival would be independent of him.

Ellerston bought into The Star through its Ellerston Overlay ASF (fund), which aims to provide investors with a return that outperforms the S & P/ASX200 accumulation over time.

The fund said in its April newsletter that it had taken an interest in The Star because despite a decline in VIP activity, it believed The Star would be a beneficiary longer term of the ongoing growth in inbound Chinese and South East Asian tourism into Australia.

“We see solid growth prospects for Star, driven by its capital investment program and growth strategy,” Ellerston said in its newsletter.