Star Entertainment continues to hold on, although its outlook has marginally enhanced in the last 24 hours. 

Facing imminent insolvency and bankruptcy, with speculation that the Australian gaming company could deplete its funds as soon as this weekend, Star has allegedly consented to sell The Star Grand Brisbane to two major investors for a paltry A$50 million (US$31.7 million). Star allocated A$1.6 billion to move its Brisbane operation from the Treasury Building to a new resort venue at Queen’s Wharf, which launched last August. 

The purchasers of The Star Brisbane, Chow Tai Fook and Far East Consortium from Hong Kong, will also take on A$430 million in debt owed to lenders that financed the resort adjacent to the Brisbane River. Chow and Far East both possess 25% of The Star Entertainment's total shares. 

Since the sale of Star Brisbane requires time for regulatory approvals, Chris Wallin, an Australian billionaire who earned his wealth in the coal sector, has consented to lend Star A$200 million to secure its short-term survival. 

Regulatory Issues 

Far East Consortium is a publicly traded firm focused on the development and management of hotels, parking structures, and mixed-use spaces. 

Chow Tai Fook is a business group that maintains strong connections with the Chinese government. The private company is familiar with gaming and hospitality, since Chow Tai Fook owns Baha Mar in The Bahamas as well as the Rosewood Hotel Group. 

If Queensland gaming regulators give their approval for The Star to sell its Brisbane stake to Far East and Chow Tai Fook, they will likely mandate that the buyers secure a third party to manage the casino and resort for them, while avoiding any direct control over daily operations. Chow Tai Fook is primarily responsible for The Star’s issues initially, as the Hong Kong company's connections to Triad groups raised suitability concerns for The Star nationwide. 

The investigations revealed that The Star did not safeguard its casinos from utilization by criminal organizations for money laundering. The Star's casinos, which include The Star Gold Coast and The Star Sydney in New South Wales alongside Brisbane, were likewise alleged to have invited and promoted gamblers banned in other states to place bets. 

Monetary Collapse 

The investigations by the government in Queensland and New South Wales resulted in the company incurring hundreds of millions of Australian dollars in penalties and corrective expenses. Regulatory issues, along with a decline in casino visitors and a reduction in significant transactions being processed, have prompted investors to flee. 

On February 28, the Australian Securities Exchange suspended trading of The Star shares due to the company's failure to submit a quarterly financial report. Star shares (ASX: SGR) are currently at A$0.11, equivalent to seven U.S. cents. 

While the trading of public shares is paused, Star announced this week via an ASX statement that Boston's State Street Corporation has purchased 144,326,001 ordinary shares at their present value, representing 5.03% of the company. State Street ranks as the fourth-largest asset manager globally.