A A$300 million ($195 million) rescue package has been approved by Star Entertainment Group’s shareholders this week (June 25), which will allow Australia’s Star Sydney casino to remain open.
This comes after The Star announced it had entered into a binding term sheet with Bally’s for a strategic investment back in April. It’s this US company that is leading the rescue bid.
Now that a deal has been approved, the casino is able to remain operational. With Bally’s chairman, Soo Kim, telling Reuters in a text message after the vote: “We look forward to the completion of our probity review so that we can get on with the critical mission to put The Star on a sustainable path.”
The Star will be Bally’s first investment in a casino in Australia, with it owning 19 across 11 states in the US.
“The strategic investments by Bally’s and Investment Holdings provide cash funding and assist The Star’s ability to continue as a going concern, helping to avoid outcomes such as voluntary
administration, which is likely not to be in the best interests of shareholders,” said The Star chairman.
What happened to Australia’s Star casino?
The Star Entertainment Group has faced a lot of uncertainty around its Sydney casino for some time now and mounting financial pressure, along with a suspended licence in the city.
The issues have been ongoing for two years now, with a previous deal having broken down earlier in the year.
Star was expected to get a new refinancing deal with Salter Brothers Capital. According to the filing via ASX, the deal broke down and the proposal was withdrawn as Star never received a ‘binding debt commitment letter.’
It was then in early April when the casino operator had struck a lifeline deal with the gaming giant Bally’s Corporation, with this arriving at a desperate time.
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