The partners in the Queens Wharf Brisbane project, a real estate development that houses The Star Brisbane casino resort in the capital of Queensland, Australia, have announced that the deadline to terminate a buyout of a portion of the overall scheme has been pushed back from Monday (July 7) to July 31. That is while parties persist with trying to forge a deal, according to filings published on Monday.
Financially-pressured Australian casino operator The Star Entertainment Group Ltd is seeking to dispose of its 50-percent equity interest in the Destination Brisbane Consortium (DBC), controlling Queens Wharf Brisbane (pictured in a file photo). That was with the aim of splitting Star Entertainment’s 50-percent equity in DBC equally between Hong Kong-listed Far East Consortium International Ltd, and privately-held Chow Tai Fook Enterprises Ltd. The latter two firms already own between them 50 percent of DBC.
Star Entertainment said in its own Monday update to the Australian Securities Exchange, that both Hong Kong parties had “this morning agreed a set of principles under which there will be certain departures from the heads of agreement, subject to which the parties will now progress their negotiations with a view to finalising long form documents”.
The casino group didn’t specify the nature of the “departures” from the heads of agreement.
Though Star Entertainment noted that to “facilitate” further talks, “the parties have agreed to extend the termination date of the heads of agreement to 31 July 2025”.
Far East stated in a Monday announcement: “Discussions between the JV [joint venture] partners and The Star have continued in the interest of agreeing the detailed commercial terms of the proposed transaction.”
Far East added: “Discussions with The Star over the past week have been focused on matters principally relating to the orderly transition of the management of the QWB [Queen’s Wharf Brisbane] project, to ensure certainty for the JV partners and other relevant stakeholders in facilitating the exit of The Star from the equity and management of the QWB Project.”
Star Entertainment had mentioned in a June 30 update its willingness to continue discussions, even after receiving notice that the Hong Kong parties intended to terminate a heads of agreement on the equity buyout, with a deadline that would have come into effect on Monday (July 7).
Far East said in its Monday update that pending any deal, certain Star Entertainment payment obligations to the Hong Kong partners would be “unaffected by the extension of the termination date”.
These included repayment to the joint venture partners – in equal amounts – of a total of AUD10 million (US$6.5 million) no later than 30 calendar days from the original July 7 termination deadline.
Otherwise, Star Entertainment would be required instead to transfer its 33.3 percent interest in “Tower 1” at Queens Wharf Brisbane to the Hong Kong partners.
Also pending any final agreement, the casino group would need to repay AUD53.3-million in shareholder loans made by the Hong Kong partners.
“The Star payment obligations will cease to apply if formal agreements are executed before the extended termination date, i.e., 31 July 2025,” added the Monday filing from Far East.
On June 25, Star Entertainment shareholders approved a AUD300-million rescue package, which the firm said would allow it to remain operational. The deal will ultimately allow United States-based casino firm Bally’s Corp to receive a controlling stake in Star Entertainment.
