Blackstone is the majority owner of Crown Resorts, which operates casino hotels in Melbourne, Perth, and Sydney. Under normal circumstances, that could be a hurdle to the asset manager buying Star because the New South Wales (NSW) government opposes one licensee running both casinos in the province. Should the operator become insolvent, it would voluntarily place itself into administration overseen by the Australian government. On Monday morning, Star confirmed that it had received an unsolicited offer from US casino and gaming group, to raise at least $250 million in capital. US gaming giant Bally's has made an unsolicited approach to Star Entertainment, offering at least $250 million in funding for the firm in exchange for a controlling stake.
It is more likely that all those circling, including Star's two Chinese partners in Queen's Wharf and Bally's in Sydney, are now waiting to pick up the assets under an administrator run auction. But most of the bank debt within the group is secured over the newly built Brisbane casino and its adjoining Queen's Wharf development. But if a sale of the assets has proved problematic, an administration could be just as complex. Beleaguered casino group Star Entertainment has barely enough cash to last until Friday and could be under administration as early as Wednesday. Star Entertainment could enter administration on Wednesday with the company set to run out of cash by the end of the week. We continue to expect Star to raise AUD 150 million in equity to draw on the second tranche. Some analysts believe that with the company close to being put into administration, meaning it could essentially become a ward of the government, finding a buyer could be difficult and that saviors are unlikely to emerge over the near term.