Local media reports claim that embattled Australian casino operator Star Entertainment Group is set to offload its recently opened The Star Brisbane integrated resort as part of a new deal with its Hong Kong partners aimed at staving off administration.
According to the Australian Financial Review, the deal with Chow Tai Fook Enterprises (CTFE) and Far East Consortium (FEC) would include an immediate injection of AU$50 million in cash although further details around the future of the AU$1.6 billion property – such as total cash consideration and whether Star would continue operating the casino in some sort of management-only deal – have yet to be revealed.
It is also yet to be seen how Queensland regulators would view Star’s Hong Kong partners assuming a full stake in the prized Brisbane asset – particularly given concerns over CTFE’s past links to infamous Macau junket Suncity Group, which collapsed in 2022.
CTFE and FEC both hold a 25% stake in The Star Brisbane – Star holds the other 50% – and each also holds a 4.99% stake in the Star group.
The reported bailout is seen as a last-minute lifeline for Star, which failed to release its interim financial results by last Friday’s deadline around concerns it would run out of cash within days.
CEO Steve McCann is known to have spent the past week searching for a last-minute rescue package.
Star revealed in January that it was rapidly burning through its cash reserves, with the company burdened by more than AU$400 million in debt, considerably higher regulatory costs since two inquiries (see here and here) into The Star Sydney found it unsuitable to hold a casino license, and a massive dip in gaming revenues as the implementation of mandatory carded play and other requirements drive players away.
The Star Brisbane is said to have further debts of its own totalling AU$1.6 billion.
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