Australia’s Star Entertainment Group has entered into an agreement with Credit Suisse Equities (Australia) Ltd (CSAL) that will see the financial services firm underwrite the AU$75.1 million Star is due to pay shareholders as per its previously announced 2020 interim dividend.
The AU$75.1 million payment represents the shortfall under Star’s Dividend Reinvestment Plan (DRP), which offers shareholders the option of reinvesting their dividend back into the company. Around 22% of shareholders, representing AU$21.2 million of the total interim dividend, have elected to reinvest under the DRP, the company said, with CSAL underwriting the rest.
The underwriting arrangements will see CSAL issued a number of shares to be calculated using arithmetic average of Star’s daily VWAP (volume weighted average price) during the pricing period.
Star Entertainment Group, whose casinos in Sydney, Brisbane and the Gold Coast remain closed due to COVID-19, announced last week it had secured an AU$1.6 billion loan for ongoing development of its AU$3.6 billion Queen’s Wharf Brisbane project.
The company had previously revealed available cash and undrawn debt facilities of AU$700 million to survive its current closure period.
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