Star Entertainment shares dive after Queen’s Wharf sale collapses
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More news: Shares in Star Entertainment fell in morning trade after the casino operator announced that plans to sell its interest in the Queens Wharf casino and entertainment complex in Brisbane to its joint venture partners had failed.
Star had hoped to sell its Queens Wharf stake to Hong Kong-based Chow Tai Fook Enterprises and Far East Consortium, but is now required to pay them an estimated $41 million.
At 11:27am AEST, Star’s share price had fallen by 9.1% to 10 cents. It is down 47.4% in the year to date.
Star Entertainment to pay out $41m as Queen's Wharf exit collapses
The news: Embattled casino operator Star Entertainment has failed to reach an agreement with joint venture partners Chow Tai Fook Enterprises and Far East Consortium over the exit of its interest in the Queen's Wharf casino and entertainment complex in Brisbane.
The numbers: Star said it is now required to repay $10 million of proceeds it received by the Hong Kong-based joint venture partners by 6 August. It must also reimburse the companies for payments made to the Brisbane resort since 31 March, expected to be $31 million, payable by 5 September.
The context: Star said it is continuing to engage with the joint venture partners and will provide an update if there are any material developments regarding the companies' interests in the project.
The gambling group is considering what alternative options may be available to it in relation to its 50% equity interest in the Queen's Wharf Brisbane casino project, along with the Treasury Brisbane hotel and car park, and its 50% equity interest in the Charlotte Street car park.
A binding heads of agreement was announced in March and long form documents between Star and the joint venture partners for the transaction were required to be entered into by 30 April. However, the deal terminated on Thursday after Chow Tai Fook and Far East Consortium issued a termination notice earlier this month.
