The NSW casino regulator is said to hold concerns over the planned takeover of embattled Star Entertainment Group by US casino operator Bally’s Corp, promising to run a close eye over its strategy to reverse Star’s flagging fortunes.
According to the Australian Financial Review, which cites two unnamed sources, the NSW Independent Casino Commission (NICC) and its chairman Philip Crawford remain “far from satisfied” with the company’s leadership – echoing concerns they held prior to Star embarking on a comprehensive leadership makeover over the past 12 months. That makeover included the appointment of Steve McCann as Group CEO and Managing Director and more recently a new CEO and new chair of The Star Sydney.
In comments to the AFR, Crawford said, “Bally’s Corporation must provide clear and convincing evidence it is suitable to be associated with a casino license.
“The [commission] will examine Star’s financial circumstances and ask Bally’s to outline its future plans for the Star including any changes in leadership and plans for the financial management of the business.”
Bally’s, under chairman Soo Kim, has outlined its desire to take control of Star and begin the process of analyzing its finances as soon as possible. Its AU$300 million rescue package in partnership with Bruce Mathieson’s Investment Holdings was recently given the green light by shareholders but still requires regulatory approval.
It is believed the NICC will delay any such decision until AUSTRAC confirms the amount Star will be fined for historical AML failures – even though any lengthy delay will place further strain on the company given its perilous financial state.
Star is also in discussions with its Hong Kong partners, Chow Tai Fook and Far East Consortium, over a proposal that would see the two companies acquire Star’s 50% stake in The Star Brisbane. In return, Star would offload all debt related to the Brisbane project as well as receiving AU$57 million and its partners’ respective stakes in two hotel and residential towers at The Star Gold Coast.
