James Packer has surprised the market with his resignation yesterday from the Gold Coast-based property developer, Sunland Group, which is currently embroiled in court action regarding a former employee in Dubai.
Having paid about $70 million for an 11 per cent stake in the group in March 2006, Mr Packer is currently sitting on a paper loss of $43.5 million. Sunland closed 8c to 71c yesterday, but there was no sign of any large scale selling.
The Herald asked Mr Packer's office if his resignation was related to the Dubai controversy.
A spokesman said: "It is not Mr Packer's policy to comment on matters relating to his investments."
In a short statement to the ASX yesterday Sunland said "Mr Packer has resigned from the board effective immediately".
In response to the Herald's call Sahba Abedian, Sunland's managing director said: "It is business as usual at the Sunland Group and yesterday's resignation by Mr Packer will not cause any disruption to the business".
"Sunland has a very strong board with a depth of talent and experience that has successfully guided the company for 25 years, and will continue to do so," Mr Abedian said.
Mr Packer joined the board as a non-executive director in March 2006, at the time when Sunland, like all property developers, were riding high on the market boom.
He bought 37.5 million securities through his private Cavalane Holdings, a wholly owned subsidiary of Consolidated Press Holdings, in July 2006, at an average entry price of $1.87. On June 3 this year, Sunland hit a low of 29c as the full impact of the global financial crisis hit.
Since that time, the market has staged a turnaround with the price moving back towards its early 2000 level.
At the time of his appointment, Mr Packer said he had "enthusiastically watched its (Sunland) growth over recent times".
"CPH wishes to take a strategic position in the group recognising Sunland's domestic achievements and international potential in the property, tourism and leisure sector," Mr Packer said in 2006.
It was widely assumed that Mr Packer would look to open a casino in one of Sunland's proposed Dubai projects. (Credit: Fairfax)
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