Struggling casino group Star Entertainment has raised doubts about its ability to continue as a going concern after confirming it has received and rebuffed offers for its 50% interest in its new Brisbane casino and entertainment resort.
Star made an announcement to the Australian Securities Exchange (ASX) to confirm media speculation that Chow Tai Fook Enterprises Limited (CTFE) and Far East Consortium International Limited (FEC) had offered to buy Star’s half stake in the Queen’s Wharf casino complex and control of the project’s debt.
The Australian Financial Review newspaper reported discussions about the deal had stalled on issues including how much Star would be paid as the long-term manager of the casino.
Star confirmed it had received several confidential, indicative and non-binding proposals from CTFE and FEC seeking to acquire its 50% interest in the Destination Brisbane Joint Venture (DBC) which owns The Star Brisbane integrated resort.
It said the Star Board has assessed each of the proposals and, after careful consideration, including external advice, concluded that none had provided sufficient value.
“The Star continues to engage with CTFE and FEC to ascertain whether a sale of The Star’s 50% interest in DBC can be negotiated on terms satisfactory to The Star. There is no certainty that any transaction will be concluded,” Star said in the ASX announcement.
The company said it continued to explore “possible liquidity solutions” and, although discussions continued, there was no certainty any would result in arrangements that might materially increase the group's liquidity position.
“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,” Star said.
By 10:45 am AEDT (11:45 pm GMT) Star Entertainment (ASX: SGR) shares rose 0.7 cents (6.36%) to 12 cents.
