Hard Rock Eyes Acquisition of Star Entertainment

Star Entertainment, one of the largest gambling operators in Australia, was tangled into a prolonged investigation over alleged breaches related to anti-money laundering rules, among other issues. Amid the regulatory hurdle, the operator remains subject to scrutiny.

Government-appointed managers seek to ensure compliance of the operator’s casinos, while back in March, the company announced leadership changes after its CEO, Robbie Cooke, confirmed plans to step down. A second inquiry into the company’s operation is currently ongoing with the result expected to be announced later this summer.

Despite the regulatory hassles, a newly released report suggests that a leading gaming operator may be interested in acquiring Star. As announced by the Australian Financial Review, Hard Rock Hotels and Casinos, the leading gaming, entertainment and hospitality giant, may be considering taking control over the struggling Australian gambling operator.

In case the aforementioned acquisition is completed, the new report suggests that Star would undergo rebranding. Moreover, the potential acquisition is expected to revamp the operator’s properties in an effort to make them less dependent on gambling revenue. Further amenities are expected to be added, including live entertainment, music, as well as hotel amenities and more food and beverage outlets. Such a plan may prove to be pivotal for the future of Star.

Per the newly released report, the bid for the Star was from a consortium that is led by Hard Rock. The Australian gambling giant is reportedly seeking advice from Barrenjoey Capital Partners regarding the potential bid.

A Number of Companies Showed Interest in Star

In light of the recent media report, the Star released an ASX announcement on the matter. “The Star Entertainment Group Limited refers to the ASX Announcement earlier today in relation to media articles speculating on potential corporate activity involving The Star.” The company confirmed that it hasn’t received a direct bid from Hard Rock.

“However, the Company has received inbound interest from a number of other external parties regarding potential transactions including a consortium of investors which includes the entity Hard Rock Hotels & Resorts, which The Star understands is a local partner of Hard Rock. The nature of the interest to date has been confidential, unsolicited, preliminary and non-binding,”

reads a statement released by the Star

However, the leading Australian gambling operator said that it has seen interest from different external companies, and this includes an investors consortium that is led by one of Hard Rock’s subsidiaries. Still, the Star said that the preliminary talks are not binding and refrained from disclosing any details publicly.

The gambling operator reiterated its dedication toward remedial activities for its Queensland and New South Wales properties amid the second government inquiry. Finally, the Star said that it will keep its shareholders informed.