- Bruce Mathieson is the biggest shareholder in Star Entertainment Group
- Prefers Bally’s takeover bid to selling Queens Wharf assets to Hong Kong group
Bruce Mathieson, the Australian businessman who’s the largest individual investor in Star Entertainment, is backing Bally’s (NYSE: BALY.T) bid to acquire majority control of the embattled casino operator and is offering to make a financial contribution to that cause.
Mathieson, 81, is reportedly more supportive of the Bally’s $156.77 million offer to purchase 50.1% of Star than he is of the Aussie gaming company’s deal to sell The Star Grand Brisbane casino resort to Hong Kong-based firms Chow Tai Fook and Far East Consortium. Various media reports indicate the billionaire businessman could be willing to kick in $31.35 million in financing to help Bally’s execute a transaction for Star.
Earlier this month, it was revealed that Star agreed to sell the Brisbane casino resort to that Hong Kong investment group to land financing needed to keep itself alive. Three days later, Bally’s emerged with a takeover offer — one that would allow Star to keep the Brisbane gaming venue.
Why Mathieson Matters in Star Takeover Scenario
Mathieson and his family currently own 10% of Star’s equity and they have approval from Australian gaming regulators to potentially double that stake. That’s to say, efforts by Star to keep itself alive, including a possible sale to a third party, likely need Mathieson’s seal of approval.
Shares of Star have been in freefall for months amid reports that creditors weren’t expecting to be repaid, and as analysts speculated the company would likely burn through its cash reserves by the end of February, making it vulnerable to being placed into administration by the Australian government. That implies that, like other investors, Mathieson has likely been losing money on his Star investment. But a Bally’s takeover could be the salve he’s looking for.
In January, Bruce Mathieson Jr., publicly stated that the family sympathizes with Australian retail investors suffering losses in Star equity, adding that the family hopes the gaming company will avoid being forced into administration. Reports surfaced earlier this year that Mathieson has been adding to his Star investment even as the stock tumbled.
It’s rumored that if Bally’s is successful in its quest to acquire Star, Mathieson would garner an increased equity stake in the company and at least one seat on the board of directors.
Bally’s Star Offer May Be More Attractive
While Star CEO Steve McCann is said to be holding talks with the Hong Kong investors, he may have no choice but to hear Bally’s out. After all, the Rhode Island-based regional casino operator is making an offer with terms that allow the Aussie company to retain its trio of primary gaming assets.
As Bally’s Chairman Soo Kim noted in a letter to the Star board earlier this month, Bally’s had $171 million in cash on hand at the end of 2024 and access to another $620 million on an undrawn revolving credit facility, implying it can get a deal done quickly and without a need to head to capital markets to do so. It’s possible that scenario becomes even smoother with a contribution from Mathieson.
Kim is the founder of Standard General, the hedge fund that recently acquired Bally’s.
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