Bally’s to take control of Star Entertainment in AU$300m deal
The proposed buyout agreement seeks to address financial pressure on the Australian operator
Key points:
– Bally’s to invest AU$250m for potential controlling stake
– Largest shareholder Bruce Mathieson to contribute AU$50m
– Funding aimed at meeting short-term financial commitments
Star Entertainment Group is reported to have reached a provisional agreement with US-based Bally’s Corporation, aimed at stabilising the Australian casino operator’s finances amid ongoing challenges. The proposed AU$300m (US$180m) arrangement includes an AU$250m capital injection from Bally’s and a further AU$50m contribution from Star’s largest shareholder, Bruce Mathieson.
Sources familiar with the matter indicate that the deal has received backing from Star’s board and its lenders. The agreement could see Bally’s take a controlling 50.1% stake in Star Entertainment, subject to regulatory approval. A portion of the funding is expected to be delivered within the week to help Star meet short-term obligations.
Star’s financial difficulties intensified earlier this year, with Chief Executive Steve McCann disclosing a dwindling cash position of AU$79m and warning of the company’s inability to sign off on half-year accounts. Previous funding proposals, including offers from Salter Brothers and King Street Capital, were ultimately unsuccessful.
In a related move, Star is offloading its 50% interest in the Brisbane Queens Wharf development to joint venture partners Chow Tai Fook Enterprises and Far East Consortium for AU$50m in cash and hotel interests.
Bally’s Corporation, which operates 19 casinos across the United States, has stated its intention to support Star’s operations in Sydney, Brisbane and the Gold Coast. Chairman Soo Kim previously indicated that the US firm could provide operational expertise and a long-term strategic partnership.
Pending regulatory clearance, the deal could mark a significant shift in Star’s ownership and operational direction as it continues to navigate legal pressures and a decline in international gaming revenue.
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