The Star Entertainment Group Limited has this week become involved in a misunderstanding with global casino powerhouse Hard Rock International after supposedly misinterpreting its interest in taking over its casinos.
The conflict started on Monday 20 May after The Star said to the ASX that it had “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 (Pacific), which The Star understands is a local partner of Hard Rock.”
Since then, Hard Rock has firmly denied any such expression of interest, stating that “any misuse of the Hard Rock name in unauthorised business dealings is taken very seriously” and that Hard Rock is “currently investigating this matter and will pursue all necessary legal actions to protect our brand and reputation.”
The Star entered into a trading halt on Monday with a market value of $1.29 billion. Shares then rose 20% following Monday’s news, making it the top gainer on the ASX, before starting to plummet.
Yesterday, an ASX announcement by The Star confirmed that it had not been “engaged in substantive discussions with the [Hard Rock Hotels & Pacific] consortium in respect to its proposal,” and that the interest it had received had been “an incomplete and indicative proposal.”
According to the Australian Financial Review, the most logical buyer would be Crown Resorts’ owner Blackstone. The final purchase decision will be subject to input from the 73,000 shareholders of The Star Entertainment Group.
Meanwhile, The Star has said it will remain focused on its “remediation activities in New South Wales and Queensland and participating in the Bell Two Inquiry.”
The Bell Two Inquiry is being conducted by Adam Bell SC at the request of the Independent Casino Commission in order to evaluate whether the Sydney casino has reformed sufficiently to earn back its Sydney licence. The inquiry follows on from Bell’s 2022 report that found The Star was unfit to hold a casino licence, due to various ethical shortfallings that led it to evading taxes and facilitating $900 million worth of banned gambling transactions.
The ongoing inquiry follows on shortly behind the April decisions by the VGCCC and NICC to allow Crown Melbourne and Crown Sydney to keep their casino licences.
