The Star says ‘yes’ to Bally’s $300m rescue package
The Star Entertainment Group has entered into a binding term sheet with Bally’s Corporation with
respect to a multi-tranche convertible note and subordinated debt instrument with an aggregate principal value of $300m.
The agreement with Bally’s follows the collapse of a $750m refinancing package with Australian investment firm Salter Brothers.
Bally’s will invest in and partner with The Star and bring a proven track record of revitalising underperforming casino businesses. Bally’s said it will continue to work collaboratively with regulators and stakeholders to support a successful turnaround of The Star. Strategically, the Transaction is intended to preserve The Star’s long-term potential, with Bally’s committed to leveraging its operational expertise to deliver a more resilient and sustainable business for all stakeholders.
Soo Kim, Chairman of Bally’s, said: “This transaction provides Bally’s the opportunity to infuse The Star with what it needs to regain its position as Australia’s preeminent gaming destination. And it allows The Star shareholders to share in what we confidently believe will be a brighter future together.”
George Papanier, President of Bally’s added: “We are excited to bring our reputation and operating expertise to a wonderful set of properties that operate in fantastic markets. We are up for the challenge.”
The Star said: “The company is engaging with the company’s largest shareholder, Investment Holdings Pty Ltd (which is controlled by the Mathieson family), in relation to a possible subscription by Investment Holdings Pty Ltdof up to $100m of the Investment. If this occurs, the investment from Bally’s would reduce to $200m. The Board of The Star intends to unanimously recommend that The Star shareholders vote in favour of the Transaction, in the absence of a superior proposal and subject to an independent expert concluding that the Transaction is in the best interests of The Star’s shareholders. Each Director of The Star intends to vote all of The Star shares that he or she holds or controls in favour of the Transaction, subject to those same qualifications.
“The Star is targeting to dispatch a booklet in late May 2025 to shareholders. Shareholders will have the opportunity to vote on the Transaction at a shareholder meeting which The Star is currently targeting to hold in late June 2025. Separately, the Directors are currently finalising The Star’s financial accounts for the period ended 31 December 2024 and intend to lodge those accounts with ASX as soon as possible,” it added.
Mr. Kim added: “Bally’s will partner with Star in deploying our significant operating experience in turning around casino assets and growing highly successful casino businesses globally. Our team has successfully improved more than 20 individual property acquisitions over 15 years in a variety of challenging circumstances, across the entire spectrum of gaming regulatory environments and market conditions. We are prepared to invest significant time and resources to work with the Company to return Star to profitability and sustainability. We have retained experienced financial and legal advisors and are prepared to engage immediately.
“We are also confident in our ability to expeditiously complete probity review in light of our long history
with of regulated operations, including in Nevada and New Jersey, as well as with the UK Gaming Commission. We have already completed substantial due diligence based on publicly available information and leveraging our understanding of the Australian gaming market and extensive experience in the international gaming sector. As a result, we are well positioned to work with Star in a focused manner to deliver a binding proposal within a short period of time.
