The companies hoping to buy Star Entertainment’s 50% stake in the new Brisbane casino and entertainment complex have insisted that the cash-strapped company pay them $36.5 million if they cannot agree on the deal by 31 July.
Star said it had agreed with Chow Tai Fook Enterprises and Far East Consortium International to extend the deadline for completing the buy-out from 30 April while they continued to negotiate over the terms.
But the company said it would be obliged to make the following payments to its partners in Destination Brisbane Consortium (DBC), Destination Gold Coast Consortium (DGCC) and other assets if long form documents were not entered into by 31 July:
- repay $10 million of the proceeds within 30 days of today
- reimburse them for Star’s share of equity contributions made since 31 March, which was expected to be about $26.5 million, within 60 days.
The Hong-based companies had previously given notice that they wanted to terminate the sale contract because the deadline had passed, although the parties had continued to negotiate a deal.
Star shareholders recently approved a plan under which Bally's Corporation will invest A$200 million and hotel industry billionaire Bruce Mathieson $100 million in stakes of up to 53.7% and 10.1% respectively, to keep Star out of administration.
Star (ASX: SGR) shares were unchanged at 12 cents at the time of writing, capitalising the company at $358.58 million, but have fallen 4% this week.
