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Star Entertainment Group

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The Star Entertainment Group Limited
Company typePublic
ASX: SGR
IndustryGambling, Tourism
Founded2011; 13 years ago (2011)
HeadquartersBrisbane, Australia
Area served
Australia
Key people
Ben Heap (Chairman)
Robbie Cook (CEO)
RevenueIncrease A$2.3 billion[citation needed]
Number of employees
8,000[citation needed]
Divisions
WebsiteStarEntertainmentGroup.com.au

The Star Entertainment Group Limited is an Australian gambling and entertainment company.[1] The company was formerly known as Echo Entertainment.[2] Star is Australia's biggest listed casino group.[3]

Properties

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The Star Entertainment owns and operates the Treasury Casino & Hotel,[4] The Star Gold Coast and The Star, Sydney.[5] Star Entertainment holds three out of Queensland's five casino operation licenses.[6]

The group also manages the Gold Coast Convention and Exhibition Centre on behalf of the Queensland Government.[7] Star owned a 50% stake in the Sheraton Mirage resort on the Southport Spit,[8] that it sold in 2023 for $192 million.[9]

Queen's Wharf Brisbane

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The Queensland Government announced on 20 July 2015 that Echo Entertainment as 50% joint venture partner of the Destination Brisbane Consortium was the preferred tenderer for Queen's Wharf, Brisbane, beating rival Crown Resorts. Echo has two Hong Kong–based joint venture partners Chow Tai Fook Enterprises and Far East Consortium. The two joint venture partners will each contribute 25% of the capital to develop the integrated resort and will also jointly pay for the apartment and broader Queen's Wharf developments.

Controversy

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In 2021 a joint report by the Sydney Morning Herald the Age, and the television program 60 Minutes, found that Star management had been warned that its anti-money laundering controls were inadequate and that between 2014 and 2021 Star had attempted to recruit high rollers who were allegedly linked to criminal or foreign-influence activities. In response to the report Star stated that it was " "concerned by a number of assertions within the media reports that it considers misleading." And also stated that it would take steps to address the allegations with Australian authorities.[10][11] Following the report shareholders began forming a class action lawsuit against Star and inquiries were launched by Queensland's, Western Australia's, Victoria's, and New South Wales's state gaming regulators.[12][13]

On 13 September 2022 the NSW Independent Casino Commission (NICC) published a report finding The Star unsuitable to hold its Sydney casino license because of its conduct relating to money laundering risks. It had 14 days to respond.[14] The company was fined A$100m ($62m) as a result.[15] Star's gambling license was suspended and operations were placed under a new manager Nicholas Weeks.[16]

In late 2022, the Queensland Government also found Star unsuitable to hold its dual state casino licences.[17] Former Court of Appeal Judge Robert Gotterson conducted an independent review of the matter.[18] Queensland Attorney-General Shannon Fentiman found Star misled regulators and failed in its anti-money laundering duties.[17] The company has been served a statement of claim for a securities class action in the Supreme Court of Victoria. The class action alleges [19] that Star breached disclosure obligations and acted against the best interests of the shareholders. Star was fined $100 million on 9 December 2022.[20] Casino licences for the Treasury Brisbane and the Star Gold Coast will be suspended for 90 days, with this action deferred until December 1, 2023. The deferment gives Star an opportunity to remediate its management and operations.[20]

In April 2024, the chair for The Star Star Entertainment Group Limited David Foster resigned from his post less than a week after giving evidence to the ongoing inquiry into the license suitability of the company's The Star Sydney property. Foster reportedly found his efforts increasingly frustrated by office politics and, in particular, the relationship between the company's Chief Executive Officer, Robbie Cooke, and the independent manager appointed to help implement an official state-mandated remediation plan, Nicholas Weeks.[21] Foster's departure came after he told the official inquiry his company was currently unsuitable to operate a casino in New South Wales. There was ‘not a scenario’ in which it would be able to run the property unsupervised. He was additionally quizzed on Tuesday over a series of ‘heat of the moment’ texts with Cooke in which the pair allegedly discussed getting rid of Weeks by having shareholders launch a class-action lawsuit against the government-appointed manager.[22]

Speculation of a potential takeover

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In May 2024, it was reported that multiple suitors were looking to acquire the company.[23] Hard Rock International was said to be weighing a bid,[24] but they subsequently stated that they were not looking into acquiring Star Entertainment.[25]

Losses

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During the 2022-23 financial year Star lost $2.44 billion. In the 2023-24 financial year the company sustained losses of $1.69 billion.[26]

See also

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References

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  1. ^ "Demerger of Echo Entertainment Group". Archived from the original on 1 June 2012. Retrieved 8 June 2012.
  2. ^ Moore, Tony (16 November 2016). "Queensland Queen's Wharf mega casino deal guarantees $1 billion for state". Sydney Morning Herald. Retrieved 22 November 2021.
  3. ^ Verrender, Ian (30 August 2024). "Star Entertainment Group's corporate reputation was shredded by a formal inquiry. Here's why it is hanging by a thread". ABC News. Retrieved 28 September 2024.
  4. ^ Moore, Tony (23 January 2015). "Brisbane casino to bring thousands of new jobs". Brisbane Times.
  5. ^ http://www.smh.com.au/business/echo-entertainment-groups-star-performer-set-for-makeover-20150204-135gua.html [dead link]
  6. ^ "Casino licensing". www.business.qld.gov.au. 15 September 2014. Retrieved 23 September 2023.
  7. ^ "About the Centre - Echo - GCCEC". www.gccec.com.au. Archived from the original on 24 March 2013.
  8. ^ "Star set to offload Sheraton Mirage for $200 million". InQueensland. 15 March 2023. Retrieved 15 March 2023.
  9. ^ McCarthy, John (27 June 2023). "Star sells off Gold Coast Sheraton as shares continue to fall". InQueensland. Retrieved 27 June 2023.
  10. ^ "Star Entertainment: Shares fall on money laundering claim". BBC News. 11 October 2021. Retrieved 28 November 2021.
  11. ^ "Star Tumbles 23% on Report It Enabled Suspected Laundering". Bloomberg. 10 October 2021. Retrieved 29 November 2021.
  12. ^ "Star Casino faces public hearings into ability to counter infiltration by organised crime". ABC News. 19 October 2021. Retrieved 28 November 2021.
  13. ^ Raphael, Angie (18 October 2021). "Star class action after share price plunge". news.com.au. Retrieved 28 November 2021.
  14. ^ "'Breathtaking arrogance': Star found unfit to hold Sydney casino licence". The Sydney Morning Herald. 13 September 2022. Retrieved 13 September 2022.
  15. ^ "Star casino: Record fine for Australian operator over money laundering". BBC News. 17 October 2022. Retrieved 17 October 2022.
  16. ^ "Star casino licence suspended". NSW Independent Casino Commission. 17 October 2022. Retrieved 17 October 2022.
  17. ^ a b Dennien, Matt (6 October 2022). "'Everything is on the table': Star unsuitable for Qld casino licences". Brisbane Times. Retrieved 11 October 2022.
  18. ^ Riga, Rachel (6 October 2022). "Star Entertainment Group unsuitable to hold casino licence in Queensland, attorney-general finds". ABC News. Australian Broadcasting Corporation. Retrieved 13 October 2022.
  19. ^ Star Faces Second Class Action Lawsuit for Non-Compliance
  20. ^ a b McKenna, Kate (9 December 2022). "Star Entertainment Group fined $100 million over Queensland casino breaches, given 12 months to 'get their house in order'". ABC News. Australian Broadcasting Corporation. Retrieved 9 December 2022.
  21. ^ "David Foster Steps Down as Chair of The Star Entertainment Group Limited". Casinos.com. 30 April 2024. Retrieved 17 May 2024.
  22. ^ "Board ousts Star chairman as inquiry blowback continues". Financial Review. 29 April 2024. Retrieved 17 May 2024.
  23. ^ Star goes into trading halt after receiving 'a number' of takeover bids
  24. ^ Star Entertainment says Hard Rock-led group weighs bid; shares surge
  25. ^ Hard Rock denies any discussions over Star Entertainment Group buyout
  26. ^ Dyer, Glenn (27 September 2024). "Star Entertainment's losses mount as regulatory pressures bite". www.sharecafe.com.au. Retrieved 28 September 2024.
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