Star Entertainment’s board remains locked in talks to ensure that it can protect more than 8000 jobs on the line, with the company running out of time and money to keep its casinos open.
Star’s shares are expected to go into trading halt on Monday, with a formal announcement due on the company’s future. They closed more than 15 per cent weaker on Friday at 11¢, valuing the company at $315 million. Star was once valued at $5 billion.
The casino operator, which failed to deliver its latest accounts on Friday, is staring down the barrel of a voluntary administration. Star’s board said it was considering last-minute “proposals” to stay afloat.
The Star casino in Sydney.Credit: Bloomberg
Star said on Friday that any proposal would need to be large enough to keep Star afloat and carry a realistic chance of materialising before its board could approve the first-half results.
The final decision on Star’s fate, which could be officially released as early as Monday, will largely be decided by Star’s creditors. Star’s management is working to convince a syndicate of bank lenders – Macquarie, Westpac, Deutsche Bank, Washington H Soul Pattinson and Barclays – to either accept a sale of its assets, valued at around $800 million, or refinance their collective debt of $430 million.
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In February, Star said it had received an $650 million offer from US alternative asset manager Oaktree Capital to refinance its debt. However, the proposal was laced with conditions, including the approval of NSW and Queensland governments and regulators, and a satisfactory settlement with existing lenders.
Star also told investors it had received overtures from its Chinese partners – Chow Tai Fook Enterprises Limited and Far East Consortium International Limited – to pick up a 50 per cent stake in the company’s Queen’s Wharf casino in Brisbane.
Meanwhile, Star’s largest shareholder and legendary hotelier Bruce Mathieson had also previously pitched two offers for the company’s Gold Coast casino.
