Bally’s to the rescue, again
US gambling giant Bally’s has once again bailed out troubled Australian casino firm The Star Entertainment Group Ltd with a significant rescue package.
cash injection that allows the firm to continue operating
On Wednesday, shareholders for Star’s casino operations in Brisbane, Sydney, and Queensland approved an AU$300m ($195m) cash injection that allows the firm to continue operating.
Star’s largest shareholder, Aussie conglomerate Investment Holdings, agreed to pony up AU$100m ($64m) to the aggregate amount, leaving Bally’s to pick up the lion’s share ($131m) of the capital needed to keep Star afloat.
Clock ticking
Star’s financial troubles were exacerbated in June by financial watchdog AUSTRAC, which wanted the company to pay a penalty of AU$400m ($259m) for multiple regulatory failures.
Star, however, pleaded poverty, stating it just doesn’t have that much money. Previously in April, Bally’s announced an AU$250m ($150.3m) acquisition of Star, saving the Aussie firm from financial collapse. The move was a lifeline for Star, saving around 9,000 jobs.
On Wednesday, Star chairperson Anne Ward stated that the latest rescue packages from Bally’s and other entities helped her firm “avoid outcomes such as voluntary administration.”
The Bally’s bailout consists of, according to GGR Asia: “multi-tranche convertible notes and subordinated debt instruments.” When this transaction is enacted, Bally’s share of Star will reportedly exceed 50%.
Biting at the bit
Despite shelling out extra millions, Bally’s Chairman Soo Kim is looking to the future.
“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,” Kim stated.
