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Star Entertainment Group is seeking shareholder approval to settle AU$11.9 million (US$8.4 million) in outstanding interest through the issuance of new shares, a move aimed at preserving cash for its casino operations.
The Australian operator’s September 24th AGM notice proposes issuing approximately 105.9 million shares to Bally’s and Investment Holdings, which is controlled by the Mathieson family. Shareholders will vote on the proposals at the October 27th meeting.
Interest Stems from 2025 Rescue Financing
The interest relates to convertible notes and subordinated debt issued under the company’s 2025 rescue financing. Although the principal was settled in November 2025, the unpaid interest remains outstanding and continues to compound at 9% annually.
Star Entertainment stated that as liquidity remains a key priority for the company, and in order to preserve cash, it wanted to settle the liability in full by issuing shares. The approach would allow the operator to direct available funds toward its core casino business rather than using them to cover accrued interest payments.
Based on the amounts due at the AGM, Bally’s would receive approximately 62.6 million shares to settle AU$7.03 million (US$4.9 million), while Investment Holdings would receive 43.4 million shares for AU$4.87 million (US$3.4 million). Both issues would be priced at AU$0.1123 per share.
Share Issue Timeline and Conditions
Star Entertainment expects to issue the shares on October 28th if approved. A later issue would require additional shares to cover further interest, while rejection would leave the liability accruing interest until the company elects to pay cash.
The timing of the share issuance is tied closely to the outcome of the shareholder vote. If approval is granted at the October 27th meeting, the company can proceed quickly with the allocation. Any delay beyond the expected date would increase the total number of shares needed, as interest continues to accumulate on the outstanding amount.
Bally’s acquired approximately 38% of Star Entertainment in late 2025 by converting its loan into equity following regulatory approval. Investment Holdings held a further 23.16%, according to the AGM notice. The proposed share issue would further cement the positions of these two major shareholders within the company’s capital structure.
Board Elections and Executive Incentives
Shareholders will also vote on the election of five directors appointed since the previous AGM: chairman Soo Kim, George Papanier, Don Pasquariello, Brooke Lindsay, and Grant Bowie. Kim and Papanier are Bally’s nominees, while the other three are classified as independent directors.
The board changes reflect the ongoing restructuring of Star Entertainment’s governance following the Bally’s-led takeover in 2025. The mix of Bally’s nominees and independent directors aims to balance oversight with the strategic interests of the company’s largest shareholder.
A separate resolution seeks approval to grant CEO and managing director Bruce Mathieson Jnr approximately 12.8 million performance rights under the company’s FY26 and FY27 long-term incentive awards, subject to the applicable vesting conditions. The incentive package is designed to align executive compensation with the company’s performance over the coming fiscal years.
Cash Preservation Remains Central
The share-based settlement proposal underscores Star Entertainment’s focus on maintaining liquidity as it navigates its post-rescue financing phase. By converting interest obligations into equity, the company can reduce immediate cash outflows while addressing its outstanding liabilities.
With the AGM set for October 27th, the company’s leadership will be looking for shareholder backing to execute its plan and keep cash reserves intact for its casino business.
Source: Asia Gaming Brief
