The Star Entertainment Group has taken the next step in its refinancing of the group’s debt with WhiteHawk Capital Partners after its commitment letter was delivered on time.
Details of the deal have been laid out as the Australian casino operator moves towards refinancing its existing debt “in full and incremental liquidity to retain sufficient liquidity for the ordinary course of operations”.
The three-year refinancing includes:
- Quantum of US$390m (approximately AUS$550m at prevailing exchange rates).
- Annual interest rate based on the Term SOFR plus margin materially consistent with the company’s recent facility agreements.
- Quarterly amortisation commencing from 31 March 2027.
- Minimum liquidity covenant of A$50m for the first 12 months after financial close.
- Increasing to A$75m between 12 months and 18 months and A$100m thereafter.
- Minimum asset coverage ratio commencing from 31 December 2026.
- Minimum EBITDA covenant commencing from 31 March 2027.
- Interest reserve account funded with first 12 months of interest.
- Customary covenants, representations, events of default and review events, including customary financial covenants and reporting obligations.
Refinancing must be completed by 15 May 2026 for The Star to avoid default, but the operator has had a provisional agreement with WhiteHawk in place since February and has been reviewing its resourcing structure and strategy.
Its implementation is subject to satisfaction of conditions precedent, including long-form finance documentation entry, receipt of required regulatory approvals, completion of the disposal of The Star’s Destination Brisbane Consortium (DBC) interest and other customary financial close deliverables.
The agreement follows The Star announcing its H1 FY26 results at the beginning of March, where the operator expressed optimism following a rollercoaster end to 2025 that culminated in normalised net revenue of A$585m (H1 FY25: $650m), as well as a significant net loss of over A$75m.
It was also the first reporting period under new management, following the A$300m strategic investment from Bally’s Corporation and Investment Holdings being completed late last year.
With Bruce Mathieson Jnr as Group Chief Executive Officer, changes have been made to The Star’s operational and marketing strategy, in addition to the roll-out of customer-focused initiatives and further cost cuts.
Mathieson Jnr said: “Our corporate office is being streamlined, and essential support functions will be managed at the property level in Sydney, Gold Coast and Brisbane. To support long-term success, these changes will strengthen our financial position.
“We continue to pursue appropriate cost-out initiatives and are exploring and implementing initiatives to attract customers to our properties. We are committed to pursuing a transparent, practical and sustainable pathway that ensures our remediation plan is delivered to the standard expected, while supporting consistency, embedment and demonstrable maturity across the group.
“We have immense potential in our properties, and we are committed to transforming The Star into premier entertainment destinations.”
