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Echo to fight attempts to remove chairman


Casinos operator Echo Entertainment is urging its shareholders to vote against a push by James Packer to oust its chairman.

The billionaire has called on the company to hold an extraordinary meeting of shareholders so they can vote on his plan to have John Story removed from his post.

Mr Packer, who owns Echo's rival casino business Crown, also wants shareholders to vote on installing former Victorian premier Jeff Kennett to the board.

In a statement released late Thursday, Echo said it would hold a shareholders' meeting on July 20.

But it said investors should vote against Mr Packer's resolutions.

"These moves by Crown should be viewed through the prism of its ardent desire to gain control of Echo's valuable licences without paying a premium to Echo shareholders," Mr Story said.

"We do not believe that it is in the interests of shareholders that a competitor be represented on the board."

Echo, which held a board meeting on Thursday, said trading conditions had remained difficult in the second half of its 2012 financial year.

Revenues had been affected by soft consumer sentiment and weak demand in all of Echo's core markets, which includes Sydney where it holds the city's sole casino licence.

Gross revenue was up by 3.1 per cent for the year to May 28, compared to the previous corresponding period.

At The Star, revenues rose 5.5 per cent.

Trading in the third quarter at The Star had been hit by management changes and negative media coverage of the recent controversy surrounding an investigation into sexual harassment claims.

"However, gaming volume and revenue growth has accelerated in May and the company remains optimistic on the outlook for The Star as operations move through the opening phase," Echo said.

Echo said it also expected at $29.9 million writedown associated with the liquidation of SilkStar Global Marketing, one of its marketing partners for international rebate players.

Echo's shares closed six cents higher at $4.40 while Crown lost five cents to $8.48.