Star Entertainment has secured a crucial financial support of $250 million from Bally’s Corporation, a prominent American casino operator. This much-needed cash infusion comes as Star, which operates casinos in Brisbane, the Gold Coast, and Sydney, faces a precarious situation with its shares suspended since late February.
In exchange for the capital, Bally’s would acquire a controlling interest of 50.1% in Star. As discussions unfolded on Friday, Star was also negotiating with two of its Hong Kong investors to sell its 50% stake in the Brisbane Queen’s Wharf casino project for an additional $50 million, aiming to avert potential administration.
Bally’s positioned its offer as a viable alternative for Star, as indicated in a letter to the Australian Securities Exchange (ASX). Soo Kim, Bally’s Chairman, expressed confidence that this infusion of long-term capital, coupled with operational expertise, would represent the best course for Star and its shareholders.
The correspondence outlined Bally’s intention to preserve Star’s existing businesses and assets, while remaining open to further negotiations for broader transactions. Although Star’s board is currently reviewing the proposal, acceptance is not guaranteed.
With approximately 9,000 employees across its venues, Star Entertainment is a significant player in the Australian casino industry, while Bally’s operates 19 casinos in the United States. This potential partnership could be a pivotal moment for Star at a time of financial instability.