The Star Entertainment Group has rejected the initial offers from its Hong Kong-listed partners, Chow Tai Fook Enterprises Limited (CTFE) and Far East Consortium International Limited (FEC), to acquire its 50 percent stake in The Star Brisbane integrated resort.
The company stated that the proposals, which were confidential, indicative, and non-binding, ‘have not provided sufficient value for The Star.’
In an ASX filing on Monday, The Star Entertainment explained that its board had thoroughly assessed the offers, including external advice, before making the decision. ‘After careful consideration (which has included external advice),’ the company said, ‘none of the proposals have provided sufficient value for The Star.’
Despite rejecting these bids, The Star confirmed that discussions with CTFE and FEC are ongoing. The company continues to explore the possibility of selling its stake in the Destination Brisbane Joint Venture (DBJV), which owns The Star Brisbane.
‘The Group continues to engage with CTFE and FEC to ascertain whether a sale of The Star’s 50 percent interest in DBC can be negotiated on terms satisfactory to The Star,’ the filing noted.
The Star Brisbane, which held its soft opening in August of 2024, has placed a heavy financial burden on Star Entertainment. The resort has contributed an additional AU$1.6 billion ($1 billion) in debt, with further investments required for its completion. The company acknowledged that its financial position remains precarious. ‘The Group continues to explore possible liquidity solutions,’ The Star stated in its announcement, emphasizing that it is exploring various options to stabilize its cash flow.
However, there is no certainty that any of these discussions will lead to a definitive solution. The company cautioned, ‘There is no certainty that any transaction will be concluded,’ and added that the ongoing negotiations could impact its ability to continue as a going concern.
The Star’s financial situation has been increasingly strained, with the company revealing earlier this year that it is burning through its cash reserves. Despite selling non-core assets such as the old Treasury Casino building in Brisbane and The Star Sydney Event Center, the company has struggled to recover financially.
‘In the absence of one or more of those arrangements, there remains material uncertainty as to the Group’s ability to continue as a going concern,’ the company reiterated in its recent filing.
As negotiations continue, the future of The Star Brisbane remains uncertain, with Star Entertainment working to resolve its financial difficulties while navigating the complexities of potential asset sales.
