A brand new entertainment hub could be the first item on the list to be sold to save an embattled casino giant from collapsing as its financial situation turns dire.
Shares in Star Entertainment plunged by more than 19 per cent to an all-time low of 10.5 cents on Friday before recovering slightly to 11.5 cents on Monday.
The casino operator has been on a downward financial trajectory ever since the fallout from a money-laundering scandal in 2021, steering high rollers away from the casino’s tables.
The business burned through $107 million in the final three months of 2024, leaving $79 million in available cash at year-end.
Without a lifeline, Star could be at risk of entering administration.
However, analysts believe it is not the end of the line for the casino giant, as its board assesses all the options to save itself from collapse.
Market analyst at moomoo Jessica Amir said there are four scenarios for the future of the Star: it goes belly up, it sells off some assets, it is bought out or it enters administration.
Ms Amir said it is unlikely chief executive Steve McCann is going to let the business collapse and will likely start selling off assets from its multi-million dollar portfolio.
The first place it could look to sell is its almost 50 per cent stake in the newly-opened $3.6 billion dining and casino precinct, Queen’s Wharf, in Brisbane.
“It is an income generating source, and there is rent that is being paid so it is generating a return,” she told AAP.
“If they do sell it at a premium, which would be highly likely given its prime position, then that could bode really well for the company.”
However, Griffith University’s Graeme Hughes said Queen’s Wharf, set to be the centrepiece for the 2032 Olympics, is the most likely to be saved.
“It’s one of those venues that you don’t want to see fail,” he told AAP.
The Queensland and NSW governments have said they will not be bailing out the Star casinos but will look to support its 9000 workers.
With property prices soaring, combined with the casino’s significant real estate portfolio, Ms Amir said the Star group would likely be an attractive investment for overseas companies looking to snap up a piece of the Australian market.
An international investor would still face the regulatory pressures the Star has been felled by – carded gaming machines to stop money laundering plus strict safe gambling protocols – but would have a more significant war chest to prop up the business to regain profitability.
But there is still a high probability the business will enter administration, Ms Amir added.
But acting NSW Premier Penny Sharpe has ruled out the possibility of a cash bail out.
“We want the casino to continue, but they need to sort out their finances, and we won’t be bailing them out,” she told reporters on Monday.
