Embattled Australian gaming operator The Star Entertainment Group has reportedly reached a refinancing deal with US casino operator Bally’s, which will allow the American operator to control a majority stake in the company.
According to a report by the Australian Financial Review, Bally’s will invest AU$250 million ($150 million), with The Stars largest shareholder, pokie billionaire Bruce Mathieson, to provide more than AU$50 million ($30 million). The publication cites sources with knowledge of the matter.
The Star turned back to Bally’s after Salter Brothers Capital withdrew a proposed AU$940 million ($593 million) refinancing plan. The deal with Salter Brothers Capital fell through as specific conditions could not be satisfied within the time frame needed to address the company’s urgent liquidity needs. At the time of the negotiations collapse, The Star was said to have enough cash to run its operations for only another week.
The Star first received the proposal from Bally’s Corporation on March 10th. It encompasses the issue of convertible notes subordinated to The Stars existing senior lenders, potentially convertible into a controlling 50.1 percent stake of The Stars fully diluted ordinary shares.
At the time of the proposal, Bally’s Chairman emphasized that the approach would ‘unlock the best alternative for the star and its shareholders’.
