Echo Entertainment Ltd chief executive officer John Redmond has pledged $1 billion to defeat rival James Packer’s proposal for an invitation-only casino and six-star hotel at Baranagaroo, according to The Australian Financial Review.
“Whatever [new] investment that we’re contemplating, and it’s going to be upwards of a billion, if not more, the investments that we’re talking about are going to have a return,” he told the AFR.
He was attempting to ease concerns about the investment, designed to protect Echo's casino monopoly in New South Wales, despite Echo not delivering promised returns on its $870 million redevelopment of The Star casino in Sydney, finished earlier this year, the newspaper said.
Mr Redmond last week said Crown was planning a "casino on steriods" for the site but had mislabelled its proposal as an integrated resort.
Crown last month offloaded its 10 per cent stake in Echo, pushing the rivals shares as low as $2.99, Echo's lowest point since listing on the Australian Securities Exchange on June 6, 2011.
The rivals are both lobbying the NSW government over Echo's casino licence monopoly in the state, with Mr Packer proposing a $1 billion six-star hotel and casino at Barangaroo to compete with Echo's The Star.
Echo operates The Star in Sydney under the only casino licence in the city.
Mr Packer said Crown wanted to pursue its proposed hotel and high-rollers casino development at the harbourside Barangaroo site in Sydney without speculation about its stake in Echo.
An independent committee established by the NSW government is set to review the exclusivity terms of Sydney's casino licence, as Echo has announced development plans for The Star to rival Crown's project.