Australia’s Star Entertainment Group has described as “unacceptable” the terms put forward by its lenders to provide requested covenant waivers for the September and December quarters on its AU$430 million (US$279 million) loan.
The waivers are seen as crucial for Star as it looks to shore up its financial position in the wake of a recently agreed AU$300 million (US$195 million) rescue package led by US casino operator Bally’s Corp and an agreement with its Hong Kong partners to offload its Queen’s Wharf Brisbane assets and associated debt.
In a filing, Star acknowledged that it continues to rely on the support of its lenders under a Senior Facility Agreement (SFA) in respect of likely covenant waivers post-30 June 2025 and continues to be in discussions with the SFA lender group in respect of potential covenant waivers for 30 September and 31 December 2025.
“The SFA lender group has proposed various terms in exchange for providing the requested covenant waivers which, in aggregate, are unacceptable to The Star,” it stated.
Star, which is due to release its financial results for FY25 before the end of this week, issued its filing in response to a report by the Australian Financial Review (AFR) which claims lenders are refusing to sign the waivers due to frustration over Star repeatedly requesting similar waivers over the past 12 months.
According to the AFR, Star has offered to pay a fee equal to around 1% of the loan amount but the lenders want a figure closer to 5%. Star’s Managing Director and CEO, Steve McCann, may instead need to refinance the company’s debt for a third time in two years if agreement can’t be reached, it added.
Star said it anticipates lodging its unaudited accounts on Friday, giving the company a month to finalize its audited accounts and potentially refinance the debt ahead of the 30 September deadline.
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