After a year in which it teetered on the brink of collapse, spent countless hours at the negotiation table with lenders and held 10 times more board meetings than the corporate average, what does 2026 hold for Australia’s Star Entertainment Group?
More importantly, will the acquisition of a controlling stake in the company by US casino operator Bally’s Corp and local partner Investment Holdings Pty Ltd lead Star back to the promised land?
That’s a difficult question to answer – particularly with the shadow of an AUSTRAC fine that could measure in the hundreds of millions looming like Mt Everest. But with Star having faced years of negative headlines, allow me to indulge in a more positive outlook.
If there is one thing the operator can take from the biblically proportioned resurrection achieved by its rival Crown Resorts in the past two years, it’s that there can be light at the end of the tunnel. Crown, which saw its Sydney, Melbourne and Perth casino licenses suspended before Star ever had its first day in court, has not only reinvented itself from top to bottom but even managed to book a healthy net profit of AU$142 million (US$94 million) with EBITDA of AU$450 million (US$297 million) for the year ended 30 June 2025 – its first profit in five years.
It’s amazing what getting your licenses back and being able to focus your energies on operations rather than compliance alone can do for your bottom line.
Crown’s transformation represents a clear playbook for Star, highlighting the importance of having casino and resort specialists running the joint rather than the plethora of consultants, bankers and AML gurus that have walked the corridors in recent years.
The big question, then, is whether Bally’s Corp and its chairman Soo Kim can actually deliver on their promises. In a recent interview with IAG, Kim spoke of his confidence in driving hundreds of millions of additional revenues and saving hundreds of millions in expenses for Star once he and his team get to work. While driving that much revenue may prove more challenging than Kim realizes, cutting excess costs – particularly those related to a massive increase in corporate headcount in recent years – seems to be the obvious low-hanging fruit once processes are in place. That there are almost a hundred people employed to do nothing more than monitor the company’s 12-hour gambling limit obligations, as one source has claimed, shows the level of overkill strangling Star’s fortunes.
But if there is one reason why Star’s long-suffering shareholders – who have watched the share price plummet from around AU$3.50 prior to the 2022 Bell inquiry to as low as AU$0.08 just six weeks ago – should feel at least a little optimistic, it’s because Bally’s has seen this show before. Soo Kim might even say that business turnarounds are its specialty, if Atlantic City and Black Hawk are anything to go by.
Bally’s is talking a big game, but progress has already been made – particularly if Star is successful in offloading the debt hole that is The Star Brisbane.
Headwinds remain, none more stifling than the play restrictions imposed on the company’s Sydney and Gold Coast casinos, but from which nearby pubs and clubs are exempt. Nevertheless, as Crown has demonstrated, this is a challenge that can be overcome.
It’s been a long and dark night for Star, but perhaps that distant horizon holds a dawn finally ready to break.
