After the sale of a 10% stake in the company for around $142 million, the Australian casino giant The Star now offers its Sheraton Grand Mirage resort on the Gold Coast for $200 million. The casino corporation thus continues its heavily discounted capital-raising drive targeted at $545 million to mitigate the $ 1.11 billion loss expected from anti-money laundering charges and the potential tax regime changes.
Luxurious beachfront property acquired in 2017:
Sheraton Grand Mirage is a luxurious beachfront property located on the Australian Gold Coast with the Star’s stake amounting to 50 percent. Other partners, Hong Kong Stock Exchange-listed Far East Consortium and Chow Tai Fook, each control 25 percent of the Sheraton Grand Mirage property. Likewise, these companies hold the same percentage in the $3.6 billion Queens Wharf casino and resort project in Brisbane.
The joint venture between these three companies was formed in 2017 when it acquired the Sheraton Grand Mirage for around $140 million. The Star contributed to the acquisition with $40 million of capital.
The sale is driven by capital raising:
The sale of the resort was announced last month when the casino operator revealed its $800 million capital raising to offset the expected statutory net loss of around $1.11 billion driven by a series of legal proceedings involving the company for failures to comply with anti-money laundering procedures, as well as the losses expected from the potential changes to the tax regime in the province.
The capital raising included $115 million of shares offered at $1.20, which was a 21% discount to the previous close of $1.52. Also, Star Entertainment sold almost a 10% stake to an Australian pokie billionaire for around $142 million to mitigate the loss imposed by the anti-money laundering breaches. The company now offers the Sheraton Grand Mirage for $200 million for the same purpose.
$ 200 million resort awaits global investors:
The Sheraton Grand Mirage stands on a 3.45 ha site on the Gold Coast and offers extensive conferencing and events facilities together with 300-car parking and more than 215 meters of beachfront. With the announced $ 200 million sale, The Star will increase the hotel turnover in the country which amounts to almost $1 billion of hotels that have changed owners this year against the $1.93 billion of hotel deals made in 2022, according to JLL Hotels & Hospitality Group, appointed by The Star to publicly offer the Gold Coast property.
“The Australian hotel market continues to attract significant interest from offshore capital, led this year by groups out of Hong Kong, Singapore, Indonesia, and the Middle East,” said Peter Harper, JLL managing director and head of investment sales. “Pleasingly, some of the larger deals saw the entrance of first-time buyers into the Australian hotel market, injecting fresh capital into the space and demonstrating the attractiveness of our sector to global investors.”
The Star and its Hong Kong-listed partners await the expressions of interest closing on April 21st.