Regulator says Star has six months – or its Sydney casino could close
Star Entertainment’s flagship Sydney gaming floors could be shut permanently if it does not meet a new six-month deadline imposed by the NSW casino regulator to regain its licence.
The NSW Independent Casino Commission has warned Star Sydney it is still not satisfied with its ability to run its flagship casino without supervision, despite a large investment in remediation programs. Star Sydney’s licence was suspended in October last year after an independent inquiry exposed extensive anti-money laundering and counterterrorism failings.
The Star’s flagship casino has been given a six-month deadline to regain its licence or face the possibility of closing. Oscar Colman
A spokesperson from the commission said Star Sydney now had six months to prove it could run without the help of its state-appointed general manager, Nick Weeks. If it does not, the casino will need approval to operate.
“The NICC is not satisfied The Star has reached a point where the licence suspension can be lifted and it can run its casino without the supervision of the manager,” the spokesperson said. “If they can’t prove they are capable of operating with a conditional licence over the next six months, the manager will be retired, and the doors will close.”
Mr Weeks was originally appointed at The Star in October for 90 days with the option to extend at the regulator’s discretion. His final term expires next June.
The new deadline will exacerbate pressures at the casino operator, which recently secured a reprieve from the state after months of uncertainty over tax rate increases that it said would put it out of business.
The ASX-listed group said in November that regulators in NSW and Queensland – where is operates casinos in Brisbane and the Gold Coast – had extended the terms of their respective independent managers to give the business more time to undertake the necessary remediation steps.
Refinancing process
A fine levied by financial crimes watchdog AUSTRAC, four class actions and two revoked state casino licences weighed on the embattled casino operator in the last financial year, culminating in a $2.2 billion non-cash impairment of The Star Sydney, The Star Gold Coast and Treasury Brisbane.
Star recently secured $450 million in new debt facilities from Barclays and Westpac as part of a refinancing process, following a strategic review undertaken by Barrenjoey Capital Partners.
A Star spokesman said the company “continues to have an unwavering focus on transformation and we know the implementation of the remediation plan in NSW and Queensland requires the utmost rigour and discipline”.
“This plan will track and hold us accountable throughout the multi-year program we are committed to delivering,” he said.
The company’s chief executive, Robbie Cooke, had previously floated selling the Sydney business after slashing more than $2 billion from the value of its three casinos. In August, Star said that was off the cards.
The company’s revenue climbed 22 per cent to $1.9 billion in the last financial year, a figure that was affected the previous year by COVID-19 restrictions. Statutory earnings excluding any significant items were slightly above previously announced guidance at $317 million for the year ending June 30, an increase of $79 million.
Introducing your Newsfeed
Follow the topics, people and companies that matter to you.
Find out moreRead More
Latest In Gaming & wagering
Fetching latest articles