Star Entertainment Group gets a new chance to pay debts and return the former reputation
The Australian gambling company, formerly known as Echo Entertainment, is currently fighting to survive and solve financial issues after New South Wales (NSW) regulator reported about the “systemic governance, risk and cultural failures” at Star property in Sydney last September. The gambling commission announced the company’s inability to operate its flagship casino in the capital due to numerous breakdowns in risk management policies.
However, things are not going so badly, and the gambling giant still has pretty good chances to recover and resume positive dynamics in generating revenue. Bruce Mathieson, an Australian tycoon and the owner of ALH hotels and Woolworths supermarket chains, is the one to become a Messiah for the casino operator. A mogul has recently bought 9.97% of Star shares, investing nearly AU$142 million in the company.
Details of Mr. Mathieson’s grand plans are still unknown to a broad audience, but still he strongly believes in Star Group’s potential. Keeping long-term objectives for the local gambling company’s further development and growth, one of the richest businessmen in Australia, started to purchase the company’s shares in the middle of February at an average price of AU$1.49.
The tycoon’s fortune is currently accounted for AU$3.5 billion, and new investments can contribute to this amount in the long ride. However, Star Entertainment Group needs to pass an audit and receive approval from regulators before a new shareholder will receive his voting rights. Such rules are determined by the Liquor and Gaming New South Wales and the Queensland Office of Liquor and Gaming Regulation agreements.
The Australian mogul considers Star Entertainment Group shares as a promising investment
Mr. Mathieson has significant experience in managing gambling establishments, being known as the largest pokie machine operator on the continent. The businessman is confident that Star Entertainment Group has resources for recovering and developing a successful development strategy. His intention to invest in the gambling company for at least three following decades is a confirmation of a growing Star efficiency.
Currently, iGaming giant assets include The Star Sidney, The Star Golden Coast, and The Brisbane Queen’s Wharf development. Bruce Mathieson believes that despite casino financial difficulties, it has the power to withstand timely challenges under the strict guidance of professionals. The businessman also emphasized that Star Entertainment became his object of interest because he has the skills and expertise to help the casino overcome hard times and get back competitive advantages.
Although Star Entertainment Group received the largest financial penalties in 2022 (AU$100 million) for law breaches and money laundering, the company has kept its operating license. According to Chief Commissioner Philip Crawford’s words, Sydney casino masked a significant profit under establishment expenses, and a gambling company repeatedly violated anti-money laundering protocols. Still, authorities haven’t announced that Star Entertainment will lose its operating permissions.
The Australian casino operator has revealed it required AU$800 million from third-party investors to solve its financial difficulties. Oaktree Capital Management was among the first companies to negotiate with Star Group. But after several weeks of discussing business nuances, participants didn’t come to an agreement, and the gambling company refused Oaktree’s proposal.
For the time being, two Australian financial services, Macquarie Group Limited, and Barrenjoey Capital are in search of large investors who will help Star Entertainment Group pay their debt back and open an AU$3.6 billion resort in Brisbane, as was planned for 2023.
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