Star Entertainment Group’s largest single shareholder is backing a bid from American casino operator Bally’s Corp to take a controlling stake in the company and has pledged to tip in another AU$50 million (US$31.5 million) of his own money should the deal proceed, according to local media reports.
The Australian Financial Review claims that Bruce Mathieson – a pubs and poker machine mogul who holds around 10% of Star’s share capital – has thrown his support behind Bally’s rather than a deal Star recently struck with its Hong Kong partners and a potential financing deal with private equity firm Salter Brothers.
The outlet, which noted that Mathieson has already been approved by regulators to increase his stake to 20%, said he could increase that holding even further and claim a boardroom seat should Star accept the Bally’s proposal. It added that he would be willing to tip in an additional AU$50 million to sweeten the deal and provide more capital to the ailing casino firm.
Star, meanwhile, has stayed publicly silent ever since confirming it had received the Bally’s offer a fortnight ago. The company previously reached an agreement with Hong Kong’s Chow Tai Fook and Far East Consortium, who each hold a 25% stake in the AU$1.6 billion The Star Brisbane which opened last August, to acquire Star’s 50% stake in the property and cannot officially speak with other parties until 25 March under an exclusivity clause.
As reported by Inside Asian Gaming, Bally’s has offered Star AU$250 million (US$158 million) for an effective 50.1% stake in the company, as well as its proven expertise in reversing the fortunes of troubled casinos.
Bally’s Chairman Soo Kim told IAG in an earlier interview that he believes Star offers greater potential with all of its assets retained than were it to be broken up and sold off for parts.
Kim told the Australian Financial Review this week, “It is not too late. Our proposal is not subject to due diligence or consents or anything. We can do this. Every deal we’ve done, people say ‘There’s no value there, or it is too hard’. We are usually the buyer of last resort.
“We have said from the beginning that our plan is the best way to preserve shareholder value. We look forward to working with Bruce to reinvigorate these great assets.”
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