Big Changes Ahead: Bally's Set to Become The Star Entertainment's Majority Stakeholder This Week

It has been a wild ride for The Star Entertainment Group, but the Australian casino operator is finally on the cusp of a major transformation. After months of regulatory scrutiny, financial turbulence, and intense negotiations, the company is about to welcome Bally’s Corporation as its new majority shareholder. Here is everything you need to know about this landmark deal and what it means for one of Australia’s most prominent gaming companies.

A Fresh Start for The Star

The Star Entertainment Group announced on November 25, 2025, that Bally’s Corporation and Investment Holdings are poised to convert their strategic investment into equity stakes by the end of the week. This marks the culmination of a challenging year for the Australian casino operator, which has been battling liquidity issues, regulatory hurdles, and a significant downturn in revenue.

At the company’s Annual General Meeting in Brisbane, Chair Anne Ward acknowledged the difficulties The Star has faced throughout 2025. Despite ongoing efforts to improve the group’s financial position, the company needed outside help to stabilize its operations. That help came in the form of an AUD 300 million strategic investment from Bally’s Corporation and Investment Holdings, a deal that investors approved earlier this year.

Ward confirmed that all remaining conditions for the investment had been satisfied, paving the way for the conversion of notes into equity. Once complete, Bally’s will hold approximately 38% of The Star’s issued capital, while Investment Holdings will control around 23%. Together, these two entities will command a combined 61% majority stake, fundamentally reshaping the ownership structure of the Australian gaming giant.

Who Are the New Players Taking the Reins?

Bally’s Corporation is a Rhode Island based omni channel gaming and entertainment operator with an impressive portfolio spanning 19 casinos across 11 U.S. states, one golf course in New York, one horse racetrack in Colorado, and a casino in Newcastle, UK. The company employs thousands of people and operates tens of thousands of slot machines, hundreds of table games, and thousands of hotel rooms across its properties.

The company has positioned itself as an aggressive consolidator in the gaming industry, pursuing strategic acquisitions while maintaining disciplined capital deployment. Earlier in 2025, Bally’s completed a merger with The Queen Casino and Entertainment, adding several regional gaming properties to its portfolio. The company also owns Bally Bet, its sports betting platform, and Bally Casino, an online casino product that continues to grow.

On the financial front, Bally’s reported strong company wide revenue growth in 2025, with its casinos and resorts division delivering double digit gains year over year. That performance highlights the company’s momentum heading into its Australian expansion and shows why it is in a position to step in as a cornerstone investor in The Star.

Investment Holdings Pty Ltd, the other major investor in The Star, is backed by the influential Mathieson family, well known figures in Australia’s hospitality and gaming sectors. Bruce Mathieson Jr. joined The Star’s board as a Non Executive Director following regulatory approval in October 2025, representing Investment Holdings’ interests and signalling a more hands on role for the family in the group’s future direction.

New Board Members Bring Fresh Perspectives

With the ownership transition comes significant changes at the board level. Bally’s will be entitled to appoint two directors to The Star’s board following the conversion. Don Pasquariello has already been announced as a Non Executive Director, subject to regulatory and ministerial approvals.

Pasquariello brings more than 40 years of experience in audit, assurance, and professional services to the table. He previously served as a senior client service partner with major firms including Deloitte and KPMG, working with some of Australia’s largest listed companies across property, construction, infrastructure, entertainment, hospitality, and healthcare sectors. His expertise spans audit, business strategy, corporate governance, risk management, and regulatory compliance, skills that will prove valuable as The Star works to rebuild trust with regulators.

Bruce Mathieson Jr., representing Investment Holdings, adds another experienced voice to the boardroom. His appointment signals the Mathieson family’s commitment to playing an active role in The Star’s turnaround and reflects the importance of local industry knowledge alongside Bally’s international experience.

The Star’s Financial Struggles: Understanding the Context

To appreciate the significance of this deal, it helps to understand just how challenging 2025 has been for The Star Entertainment Group. The company reported normalized group revenue of around AUD 1.2 billion for fiscal year 2025, representing a drop of close to 30 percent compared to the previous year. Gaming revenue fell sharply, while non gaming revenue such as hotel stays, dining, and entertainment proved more resilient.

The company recorded an EBITDA loss before significant items and a statutory net loss of roughly AUD 471 million. Cash reserves fell over the course of the year as the group grappled with falling revenues, remediation costs, and higher interest expenses. In practical terms, The Star was burning through cash and urgently needed a lifeline to avoid breaching its debt covenants and maintain operations.

Management responded with aggressive cost cutting measures, reducing operating expenses by more than AUD 100 million and hitting a target for annualized savings. The company also sold non core assets, including The Star Sydney Event Centre, which was sold to Foundation Theatres, to shore up its balance sheet. Even with those steps, the financial situation remained fragile, creating the backdrop for the Bally’s and Investment Holdings rescue deal.

The Bally’s investment provided critical liquidity support, with hundreds of millions of dollars already received by August 2025. This injection gave The Star breathing room to keep trading while it worked through its regulatory issues and reset its strategy.

Regulatory Hurdles and the Path to Suitability

The Star’s troubles extend beyond finances. The company has faced intense regulatory scrutiny since 2021, when authorities began investigating potential breaches of anti money laundering and counter terrorism financing laws. Those investigations exposed serious governance and compliance failures and triggered a series of inquiries and enforcement actions.

In New South Wales, the NSW Independent Casino Commission suspended The Star Sydney’s casino license in 2022, appointing Nicholas Weeks as manager to oversee operations. Weeks has remained in this role, with his term extended several times as regulators monitor the company’s remediation efforts and conduct. In September 2025, the NICC extended the suspension until at least March 31, 2026, underlining that The Star still has work to do before regaining full control of its flagship Sydney operations.

The situation in Queensland follows a similar pattern. The Star Gold Coast was handed a 90 day license suspension that has been deferred multiple times while the company implements required reforms. In late 2025, the Queensland government extended the deferral of that suspension until September 30, 2026, and extended Nicholas Weeks’ role as special manager. An external advisor also remains in place for The Star Brisbane until 2026, keeping a close eye on governance, risk management, and compliance.

Adding to these concerns, AUSTRAC, the federal agency responsible for anti money laundering enforcement, has launched civil proceedings seeking a substantial penalty against The Star for historic compliance breaches. The company has warned that any fine above a certain level could push it towards insolvency, highlighting how regulatory outcomes are tightly linked to its financial survival. A court decision on the penalty is still pending, and the new shareholders will inherit both the risk and the responsibility to fix the underlying issues.

Leadership Changes at The Star

The regulatory crisis prompted significant leadership changes at The Star. Steve McCann, the company’s CEO and Managing Director, joined in late 2024 after receiving the necessary approvals from regulators. McCann brings considerable experience to the role, having previously served as CEO of Crown Resorts, where he helped steer that company through its own high profile regulatory overhaul before it was taken private by Blackstone. Before his time at Crown, he spent more than a decade leading global construction and property group Lendlease.

McCann has been candid about the company’s precarious position while also pointing to progress made on remediation and liquidity. In recent shareholder communications, he has stressed that strengthening the balance sheet remains a key priority and welcomed Bally’s capital injection as a crucial pillar of the turnaround plan. He has also highlighted that the team has made meaningful progress over the past year but still faces a demanding schedule of milestones across regulatory, financial, and operational fronts.

As part of the restructuring, The Star is preparing to cut around 40 senior roles, targeting management layers and support functions to streamline decision making and reduce costs. At the same time, the company is considering new appointments in risk, compliance, and operations to meet regulators’ expectations and support future growth under the new ownership structure.

Chair Anne Ward, who has led the board through a period of extreme turbulence, has said she will retire once the Bally’s and Investment Holdings share conversions are complete and their nominees are in place. She has described the workload over the past year as extraordinary, noting that the board held many more meetings than is typical for an ASX listed company as it responded to inquiries, negotiations, and regulatory demands.

The Star’s Properties and What They Mean for the Future

The Star Entertainment Group owns and operates three major casino properties across Australia. The Star Sydney is its flagship asset, located in Pyrmont, and combines gaming floors with luxury hotels, fine dining, entertainment venues, and residential offerings. The property has long been a key tourism draw for Sydney, although its license suspension means its gaming operations currently run under special oversight.

The Star Gold Coast is a large resort complex on Broadbeach Island, offering more than 1,000 hotel rooms, suites, and apartments across several towers, plus a wide mix of restaurants, bars, and event spaces. The property has benefited from domestic tourism and major events, but like Sydney it has had to adapt to heightened regulatory scrutiny and oversight.

The Star Brisbane, part of the Queen’s Wharf integrated resort development, opened in August 2024 as a showcase riverfront destination featuring a new casino, multiple hotels, public spaces, and high end retail and dining. The project was originally developed through the Destination Brisbane Consortium, a joint venture between The Star and Hong Kong based partners Chow Tai Fook Enterprises and Far East Consortium. Under financial pressure, The Star agreed in 2025 to sell its 50 percent stake in the development for a relatively modest sum, but it aims to continue as manager and operator of the casino, preserving its presence in the Brisbane market.

Bally’s Chairman Soo Kim has expressed strong interest in all three properties, highlighting their locations, brand recognition, and unrealized potential. He has said Bally’s expects to unlock significant revenue growth and achieve large cost savings at The Star through better operational discipline, technology upgrades, and leveraging Bally’s broader experience in property optimization.

What This Deal Means for the Australian Casino Industry

The Australian casino and gaming market remains a sizable and stable sector, even as it faces increasing regulatory pressure and competition from online gambling and crypto gambling platforms. Revenue in the casino and casino games segment is projected to reach around USD 6 billion in 2025, with modest growth expected over the next several years. When including sports betting, lotteries, and online wagering, total gambling revenue in Australia is forecast to exceed USD 15 billion annually.

The Star’s main domestic competitor is Crown Resorts, which operates casinos in Melbourne, Sydney, and Perth. Crown went through its own set of inquiries, license issues, and remediation programs and was ultimately acquired by private equity group Blackstone in an AUD 8.9 billion deal in 2022. That transaction brought deep pockets and international expertise into the Australian market and set a precedent for foreign backed turnarounds of local casino brands.

With Bally’s now set to take control of The Star, both of Australia’s largest casino operators will be backed by global investment and operating platforms. This could intensify competition for high value players, tourism partnerships, and large scale events, while also raising the bar for compliance, corporate governance, and responsible gambling practices. At the same time, regulators in New South Wales and Queensland have signalled that they see the Bally’s investment as a constructive step, approving the transaction after extensive probity checks and stressing that the new ownership must support long term cultural change at The Star.

Bally’s Bigger Picture and Future Development Plans

Bally’s investment in The Star fits into a much larger global expansion strategy. One of the company’s most high profile projects is in Las Vegas, where it plans to redevelop the former Tropicana site into a new mixed use resort district. Current plans call for two luxury hotel towers with around 3,000 rooms, a 2,500 seat entertainment venue, extensive retail and dining offerings, and integrated public spaces linked to the future home stadium of Major League Baseball’s Oakland Athletics relocation to the Strip.

Construction on the Las Vegas development is expected to start in the first half of 2026, following demolition and site preparation works. The project is designed as a long term anchor asset for Bally’s in the most competitive casino market in the world, and its scale underscores the company’s willingness to commit significant capital where it sees strong strategic fit.

In Chicago, Bally’s is developing a USD 1.7 billion casino resort on the site of the former Chicago Tribune printing plant along the Chicago River. The plan includes a large casino floor with more than 3,000 slot machines and hundreds of table games, a 500 room hotel tower, multiple restaurants and bars, and a theatre style entertainment venue. A temporary casino is already operating in Chicago, and construction on the permanent complex is progressing, with an opening currently targeted for late 2026.

Internationally, Bally’s has also reshaped its digital and lottery footprint through a major transaction with Greek lottery and gaming group Intralot. In 2025, Bally’s sold its international interactive business to Intralot for several billion euros while becoming a significant shareholder in the combined lottery and igaming platform. The move allows Bally’s to focus its own capital on core land based and North American operations while still gaining exposure to global lottery and online gaming growth through its equity stake.

Bally’s Leadership and Their Strategy for The Star

Bally’s Chairman Soo Kim has been outspoken about his expectations for The Star and the changes he wants to see. After securing probity approval from Australian regulators, he indicated that Bally’s plans to introduce substantial operational reforms at The Star’s properties, targeting what he views as years of underperformance and weak management discipline. He has framed the deal as an opportunity to bring fresh thinking, robust risk controls, and a sharper commercial focus to the Australian group.

Kim has also emphasized the importance of maintaining constructive relationships with The Star’s joint venture partners in Brisbane and other stakeholders, including governments, regulators, employees, and local communities. Even though the ownership structure is changing, Bally’s wants to keep managing the Brisbane casino and deliver on the expectations set when Queen’s Wharf was conceived as a landmark tourism precinct.

The new ownership structure gives Bally’s significant influence over The Star’s direction. With 38 percent of issued capital and the right to nominate multiple board members, Bally’s will have a leading voice in strategy, capital allocation, and key executive appointments. Combined with Investment Holdings’ 23 percent stake and its board representation through Bruce Mathieson Jr., the new shareholders form a controlling bloc that can drive the turnaround agenda and, if necessary, push through difficult decisions on restructuring, asset sales, or leadership changes.