Troubled Australian casino firm The Star Entertainment Group Ltd said in a Monday filing it had a binding term sheet agreement with U.S.-based casino operator Bally’s Corp for an AUD300 million (US$180.2 million) rescue package.
The deal, involving “a multi-tranche convertible note and subordinated debt instrument”, will ultimately transfer control of Star Entertainment to Bally’s.
The first payment, of about AUD100 million, is scheduled to take place by Wednesday. The deal with Bally’s will allow the Sydney-based casino group to remain afloat in the short term.
The remainder will be paid following a vote by Star Entertainment shareholders, set to take place in “late June”, and upon receipt of regulatory approval, according to the filing.
Once concluded, the deal will give Bally’s control of approximately 56.7 percent of the Star Entertainment entity.
Star Entertainment had already received a mid-March bid – described at the time as “unsolicited” – from Bally’s for a stake in the Australian operator.
In addition to running The Star Sydney (pictured in a file photo) in New South Wales, the group also operates The Star Brisbane in Brisbane, Queensland.
The Australian casino operator added in its latest filing that it was still in talks with its largest shareholder, Australian businessman Bruce Mathieson, to contribute approximately AUD100 million to the investment package. If that proceeds, Bally’s investment would be reduced to AUD200 million.
The Star’s shares remain suspended from trading on the Australian Securities Exchange, as the company has yet to lodge with the bourse its half-year financial report for the period ended December 31, 2024.
