Star Entertainment shares fall as Hard Rock International denies takeover interest
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More news: Shares in Star Entertainment dived after Hard Rock International denied discussions over a potential bid for the casino operator.
Shares were down 7.4% to $0.50 by 12:30pm AEST, having closed 17.22% higher on Monday.
The Star later reconfirmed that the group had received an "incomplete and indicative proposal" from a consortium of investors that included the entity "Hard Rock Hotels & Resorts (Pacific)".
Macquarie analysts noted that while the Star has "attractive long-duration casino licences", there were "significant near-term uncertainties" and any transaction would be highly conditional.
These included probity approvals which may take 12 months, the resolution of an estimated $350 million AUSTRAC monetary penalty, the outcome of the NSW casino inquiry, Queen's Wharf Brisbane debt refinancing, and access to due diligence on Queen's Wharf Brisbane given its progressive opening from August 2024.
It noted any transaction would likely need support form Bruce Mathieson, and the joint venture partners Chow Tai Fook and Far East Consortium who hold around a 16% stake in Star Entertainment.
What they said: The analysts said: "Hard Rock Hotel & Resorts is a familiar name with interest in Integrated Resorts within Australia, having previously shown interest in obtaining a casino licence in Queensland in 2018".
"However, with no new casino licences issued in Queensland, [Star Entertainment] retained its monopoly within Brisbane and the Gold Coast," they said.
Hard Rock International denies Star Entertainment takeover bid
The news: Hard Rock International has denied discussions over a potential bid for Star Entertainment, a day after the casino operator's shares soared on the ASX following reports of a possible takeover by the Florida entertainment group's Pacific arm.
The numbers: The Star was the best-performing ASX 200 stock on Monday, closing 17.22% higher, after the group confirmed it had received takeover interest from a consortium that included "Hard Rock Hotels & Resorts (Pacific)", which it believed to be a local partner of Hard Rock Hotels and Casinos.
The context: Hard Rock said it wanted "to make it clear" that the US group is not involved in or authorised any discussions, activities or negotiations in connection with a proposed bid for the Star. It also denied authorising the use of the Hard Rock brand in connection with a proposed bid for Star by any third party.
What they said: In a media release, Hard Rock said: "Our brand is built on a legacy of integrity, excellence, and a commitment to our guests, partners, and team members worldwide".
"Any misuse of the Hard Rock name in unauthorized business dealings is taken very seriously. We are currently investigating this matter and will pursue all necessary legal actions to protect our brand and reputation," it said.
"We urge stakeholders and the public to rely only on official communications from Hard Rock International for accurate information regarding our business activities and partnerships."
The sources: Hard Rock International, Macquarie research, ASX announcement
