US casino operator Bally’s Corp has today been granted probity approval by regulators in the Australian states of New South Wales and Queensland – home to Star Entertainment Group’s casinos – to become a substantial shareholder of Star.
In a statement issued early Friday morning, the NSW Independent Casino Commission (NICC) confirmed that Bally’s and its related entities and key individuals associated with the transaction have cleared a comprehensive probity investigation conducted by the NICC and Liquor and Gaming NSW, which assessed a range of financial and non-financial factors related to suitability.
As such, Bally’s proposed corporate and individual close associates have been approved as “suitable persons” to be associated with the management and operation of The Star Sydney.
The NICC said it has also approved the increased shareholding of Bally’s as a “major change” in the state of affairs of the casino operator of The Star Sydney, which is required under the Casino Control Act 1992.
Queensland Attorney-General Deb Frecklington issued a statement of her own on Friday morning in which she revealed the Office of Liquor and Gaming Regulation had in conjunction with NSW regulators completed its investigation into the suitability of Bally’s Corporation and associates to be involved in the ownership and management of Star’s casino operations in Queensland – currently comprising The Star Gold Coast and The Star Brisbane. Star is, however, in the process of offloading its 50% interest in the Brisbane operation.
“Following this investigation, and after careful review of the material presented to me, I have now granted the necessary regulatory approvals, which will allow Bally’s Corporation and Investment Holdings to convert their debt into equity in The Star, at their discretion,” Frecklington said.
“This will provide both entities with a significant ownership stake and influence over the management of The Star’s casino operations in Queensland.”
As reported by IAG, Bally’s and Bruce Mathieson’s Investment Holdings have provided an AU$300 million (US$195 million) rescue package to Star that will upon conversion raise their combined stake in the company to 61%, of which Bally’s will hold around 38%.
In announcing probity approval, NICC Chief Commissioner Philip Crawford said Bally’s had submitted a plan to improve Star’s financial performance, which it will be required to report back on regularly as a condition of the approval.
“Bally’s Corporation and its associated entities have undergone a rigorous assessment and ultimately satisfied the NICC that there are no adverse findings that would prevent them from becoming close associates of The Star,” Crawford said, adding that Mathieson and Investment Holdings had also been approved to increase their shareholdings in the company.
“Both the close associate approvals and the major change approval for The Star will allow Bally’s and Investment Holdings to move forward with their financial and operational commitments in respect of The Star which we anticipate will be happening very soon.
“Bally’s and Investment Holdings have assured the NICC they will continue the essential remediation work required at The Star so that it can continue to remedy the serious concerns raised in the two Bell inquiries.”
The NICC’s decision does not affect the current status of The Star’s licence which remains suspended, with NICC-appointed manager Nick Weeks continuing to have oversight over casino operations, the regulator added.
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