The Star refinancing proposal withdrawn
The casino operator remains unable to publish its half-year financial report.
Australia.- The Star Entertainment Group has announced that a refinancing proposal from Salter Brothers Capital (SBC) has been withdrawn. A deal could have provided the company with up to AU$940m (US$590m) in debt capacity, but the casino operator said it had not received a binding debt commitment letter.
The Star said: “The withdrawal of the refinancing proposal follows extensive engagement by The Star with SBC and relevant third parties, including state governments and regulators. As a result of that engagement, it became apparent that it was unlikely that a number of the conditions precedent to the refinancing proposal would be able to be satisfied, either at all or in sufficient time to address the current liquidity needs of the company. In particular, lender requirements for specific priority arrangements and enforcement rights in relation to their proposed security over non-gaming assets of The Star could not be met.”
As a result, the casino operator remains unable to publish its half-year financial report for the period ending December 31, 2024. The company said it continues to explore liquidity solutions, including with US casino operator Bally’s Corporation, which has offered AU$250m (US$157.8M) for a controlling stake in the company. Bally’s owns and operates 19 casinos in 11 US states and has acquired Aspers Casino in Newcastle, UK.
Earlier this month, The Star entered into an agreement with joint venture partners, Chow Tai Fook Enterprises Limited (CTFE) and Far East Consortium International (FEC) to sell its 50 per cent stake in Destination Brisbane, owner of The Star Brisbane integrated resort. The Star will receive an upfront cash payment of AU$53m (US$33.4m).
The Star will no longer receive the operator fee under the Destination Brisbane casino management agreement. Instead, it will receive a fixed fee of AU$5m (US$3.2m) per month until June 30, 2026 and AU$6m per month thereafter. The company added that it may receive up to AU$225m (US$142m) in future consideration from an earn-out mechanism regarding The Star Brisbane.
