Star Entertainment shares tumble 9% after Queen’s Wharf deal terminated

The longer-term investment case is clouded by the threat of Crown Sydney, liquidity risk and tightening regulatory measures. This article explores the once monopolistic establishment and why we believe its trading over 50% below its fair value. Star Entertainment’s shares will remain suspended for at least another week as the casino operator’s chief executive, Steve McCann, tries to secure the last of a series of deals critical for the company to stay solvent.
ASIC has accused them of not paying sufficient attention to the risks of money laundering and criminal association that have financially crippled the casino operator with massive fines and gambling restrictions on its pokies. The casino operator also remains embroiled in legal challenges, with the financial crimes regulator AUSTRAC seeking a $400 million penalty against the company for alleged money laundering, in a court case that kicked off earlier this month. Star Entertainment’s major Macau-based investor has increased his stake in the company for a second time in a week, with the mystery businessman now owning almost 7 per cent of the struggling Australian casino rewards program operator. More than 8000 jobs hang in the balance as teetering casino operator Star Entertainment is on the brink of financial collapse, with its board in last-ditch talks late on Friday to find the cash needed to keep the company afloat.
Star Entertainment was suspended from trading by the ASX on Monday over its failure to lodge financial statements for the December half-year. Star Entertainment Group was delisted from the top Australian casino bonus codes 2026 Securities Exchange on Monday as the group faces scrutiny over a series of scandals related to criminal activity and unethical conduct at its casinos. “Any deal that promises to keep venues in Brisbane, the Gold Coast and Sydney operating as a going concern is a good result for the Star workers, their families and the communities they live in,” the union’s casino director Andrew Jones said. “We’re always looking at everything within the best interest of the staff certainly our shareholders,” Daniel Finch, progressive jackpot slots CEO The Star Brisbane, said 7NEWS on Monday.
Apart from the higher regulatory costs following a run of scandals, Star’s fortunes have also been hurt by poor gaming turnover at its casinos and the move to cashless gaming in NSW, with Queensland to follow. Star also told investors it had received overtures from its Chinese partners – Chow Tai Fook Enterprises Limited and Far East Consortium International Limited – to pick up a 50 per cent stake in the company’s Queen’s Wharf casino in Brisbane. A $2.2bn non-cash impairment was reported for Sydney, craps strategy Omaha Gold Coast and Harvest Buffet menu Treasury Brisbane goodwill and property assets. There were also regulatory and legal costs of $595m, debt restructuring costs of $54m and redundancy costs of $16m.
New rules that would have restricted patrons to gambling $1000 in cash per day will not be introduced for another two years after lobbying from casino giants. This came as bad news with Star’s performance historically lagging behind Crown casino in Melbourne, with both revenue and earnings falling short of its competitor. This long history of underperformance continues despite Sydney being the country’s largest city and international gateway to no deposit bonus slots Australia. “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.” In an update to the stock exchange this morning, Star reported a loss for the second quarter — although not as bad a loss as the previous period, as it managed to cut costs. Earlier this week, Star published its quarterly report, which precedes audited financial accounts due next month.
Star chief executive Steve McCann has unsuccessfully tried to coax lenders, state governments and investors into giving the embattled casino operator the time and cash needed to work through its challenges. Embattled casino operator Star Entertainment has warned that it faces “material uncertainty” over its ability to stay afloat unless it finds a solution to its worsening financial woes, sparking a further drop in the company’s share price. Shares in The Star Entertainment Group Limited (“Star”) tanked last week after their first day back on the ASX in almost a month. This ended a prolonged trading halt further aggravated by a slap-on-the-wrist ASX suspension for failure to provide timely financial accounts.