Peter Bacon: He's come from the casinos of Sun City to play one-armed bandits in Britain

The chief of South African gambling giant Sun International tells Abigail Townsend why he's rolling the dice on UK expansion
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The Independent Online

Family life, for busy suits intent on building empires, is never an easy thing to navigate. Too much time away from home, too little spent with the kids, strained relationships - you get the picture.

Family life, for busy suits intent on building empires, is never an easy thing to navigate. Too much time away from home, too little spent with the kids, strained relationships - you get the picture.

Try, however, Peter Bacon's domestic set-up for size. The chief executive of South African casino and resort giant Sun International has two teenage stepdaughters, three other daughters in their twenties and is married to a former Miss World, who in her turn was previously married to his former boss and now an industry rival, the larger-than-life Sol Kerzner.

Then there's the commuting: the family lives in Cape Town but his office is in Johannesburg. And soon that arduous 780-mile journey might seem like a stroll, for the group is poised to unleash a £600m investment in the UK market, putting him on first-name terms with Customs officials at Heathrow.

Nor is that office, once he's made it in, usually an oasis of calm. Sun International has history: it owns Sun City, the legendary resort founded by Kerzner and once one of the most hated symbols of the apartheid regime, and faced potential ruin in the mid 1990s when the new government overhauled the gaming laws.

Even the planned launch of UK casinos is not without obstacles, for the Government will announce this week how big resorts should be and how many gaming machines will be permitted. It will be a crucial decision: in casinos, it is those rows of one-armed bandits that bring in the money, no matter how many scalps the roulette table claims.

Yet if anyone can handle all that, Bacon is probably the man. Quiet, measured and diplomatic, he poses awkwardly for photographs before running through a steady career in which he has risen, eventually, to lead one of the world's biggest gaming organisations.

Born in Birmingham 58 years ago, he eschewed a job in his father's manufacturing firm despite going to college to study engineering; "I lasted one year, I hated it." Instead, he become a personnel manager at the Forte hotels chain.

Not long after, a chance to quit 1970s England came along when he was approached about a job in South Africa. "I thought about it carefully. I had a good position with Forte but was offered another good one that gave me the opportunity to experience another country. Most young people aspire to that."

He joined Southern Sun, the precursor to Sun International, in human resources but soon moved into an operational role. There then followed stints in Monte Carlo and London before returning to a country and company in the midst of change in the early 1990s. Kerzner had gone his own way, and the fall of apartheid was bringing its own challenges.

Under previous governments, gambling had been banned, but the black "homelands" had been happy to grant licences and the industry flourished. Then, with the collapse of apartheid and the installation of a new government, the homelands were drawn back into the country and the gambling laws were overhauled. It was now legal, but the new rules dictated that operators had to start again from scratch with their licences.

For Sun International, this was something of a disaster. "It meant the development of a new strategy," explains Bacon, "to comply with the new legislation, and that involved quite a significant downsizing." The estate was slashed from 17 resorts to just seven. "We sold, we closed, it was quite a painful process. But we had to do it and we got though it."

The company re-applied for licences but it was a tough time. "We were accused of having it too good for too long. A company that had been built up in a short period was now faced with the daunting risk of closing down casinos and re-applying. It was difficult to get the mindset right. The focus had to be on the future rather than the past or present."

Since then, the company has regrouped, with a bigger focus on family-oriented leisure complexes, all a world away from the brash reputation of the 1980s Sun City. And even that has since been brought into the family-friendly fold.

"The popular perception is far from the reality," says Bacon of Sun City. "It's an active resort with a wide range of facilities. It's anything but glitz and glamour."

The group, with 21 casinos in South Africa, is now looking overseas for growth. The last time Sun International ventured aboard, it failed to go as expected and eventually led to the splitting of the business. Kerzner took control of the international arm (now called Kerzner International and listed in New York) while Bacon moved into the now-vacant top slot in South Africa.

This time round, extensive planning has been done, with a team in place in the UK for nearly two years now - even though the Gambling Bill is unlikely to become law for another two years. Bacon wants to open up to five large-scale leisure and gambling complexes, and areas of interest are Sheffield, Glasgow, Newcastle, Birmingham and Leeds, among others.

Issues remain, however. First is the cap on machines. Margins are lower on tables, so the more one-armed bandits, the better the return. The Government is expected to back a limit of 1,250, which Bacon is happy with.

The other issue is tax. The sector currently pays 40 per cent, which most agree is too high to make UK expansion pay. It is hoped it will be brought down to the bookmakers' rate of 15 per cent, but the final decision is up to the Treasury.

In the meantime, Bacon is getting on with laying the groundwork and enjoying the South African lifestyle he decided to check out 30 years ago. He doesn't gamble but relishes his Cape Town home and the simple things in life: walks on the beach, yachting, the odd game of tennis, all those daughters.

He talks proudly about the changes South Africa has undergone - "it truly is a rainbow nation now" - but chooses his words with a diplomat's care when discussing the previous regime. "We were a company that was very much opposed to apartheid. We stated our position and didn't make ourselves popular in doing so." He points out that the company operated in homelands, where races could mix, though fails to mention that resorts like Sun City were whites only.

He has no regrets about moving to South Africa - "for me, it was a good decision" - but as he edges towards the final years of his career, the UK is calling once again.

If it pays off, it will be a fine way to sign off. But, for all the careful planning and steady approach, nothing is guaranteed - particularly with so many other overseas operators also eyeing up the UK. Bacon's homeland could end up being the non-gambler's biggest gamble yet.

BIOGRAPHY

Born: 22 July 1946.

Education: diploma in hotelkeeping and catering, Stanford Executive Programme, Stanford University.

Career:

1966: lecturer, Malta College of Arts, Science & Technology.

1968: personnel manager, Forte.

1973: group personnel manager, group operations manager and then managing director at Southern Sun, the precursor to Sun International.

1984: managing director of Sun International subsidiary Royale Resorts.

1994 to now: chief executive, Sun International.

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