Australian Billionaire Bruce Mathieson-Backed Casino Operator May Run Out Of Cash

Star Entertainment Group—backed by Australian gambling billionaire Bruce Mathieson—is facing the risk of running out of cash as the embattled casino operator struggled to raise fresh capital amid slumping gaming revenues.

The company is exploring various options to increase its liquidity, but it has limited capacity to raise A$150 million ($93 million) in subordinated debt, Star said in a statement to the Australian Securities Exchange on Monday. This funding is a crucial requirement for unlocking an additional A$100 million loan.

“In the absence of one or more of those arrangements, there remains material uncertainty as to the Group’s ability to continue as a going concern,” Star said in the statement. Star’s shares tumbled 17.9% to close at A$0.115 in Sydney trading.

The company’s cash reserves decreased to A$79 million at the end of December 2024, from A$149 million three months before. Star attributed this decline to challenging business conditions, including a A$5 million installment payment toward the A$15 million fine imposed by the New South Wales Independent Casino Commission in October due to misconduct.

At the same time, Star’s revenues had been softer, slipping 15% to A$299 in the three months to December, compared to the previous quarter. This was primarily due to the closure of Treasury Brisbane Casino and ongoing softness at The Star Sydney following the implementation of mandatory gaming restrictions imposed by the regulator.

The troubles of Star started in 2021 after the Sydney Morning Herald reported that the company allowed money laundering and organized crimes in its casinos for years. The following year, regulators ruled that the company is unsuitable to operate its casinos in Sydney and Queensland, placing them under government supervision. Since then, almost A$4 billion in Star’s market capitalization had been wiped out.

Mathieson is Star’s largest shareholder with a stake of about 10% stake, according to the company’s latest annual report. He has an estimated net worth of $1 billion according to Forbes’ real-time data. Mathieson runs his poker machine and pub empire, Australian Liquor and Hospitality, in a joint venture with supermarket giant Woolworths. He also holds a minority interest in the publicly listed Endeavour Group, which owns both the Australian Liquor assets and Woolworths’ liquor retailing business.