US-based casino operator Bally’s Corporation has agreed to invest $300 million into The Star Entertainment Group, marking a major move into the Australian gambling market as The Star battles financial and regulatory headwinds.
The deal, announced in April 2025, gives Bally’s the option to take a controlling stake in The Star, following the acquisition of convertible notes and subordinated debt. The injection of capital provides crucial breathing room for the Australian operator, which has faced plummeting share prices, mounting losses, and regulatory scrutiny.
The investment comes at a time when global interest in both land-based and online gambling is growing. As many Australians are turning online to enjoy pokies at platforms where there is no minimum deposit, no opening hours, and no travel needed, The Star Entertainment Group has been struggling to keep up.
The Star was once a dominant force in Australian gaming, but has faced several challenges in recent years. Regulatory investigations in New South Wales and Queensland uncovered serious failures in compliance and governance, triggering fines, licence suspensions, and a dramatic fall in investor confidence.
The Star has been racing to raise fresh capital amid slumping gaming revenues. Its troubles began in 2022, after regulators found the company unfit to hold casino licences following media reports of alleged money laundering at its properties. The company has since faced lawsuits, leadership changes, and write-downs.
The rescue package consists of multi-tranche convertible notes and subordinated debt instruments. The first tranche of $100 million has already been paid by Bally’s and will keep The Star operational for around 15 months. The remainder, $200 million, will follow pending regulatory approvals and a shareholder vote scheduled for mid-June 2025.
Rhode Island-based Bally’s and The Star’s largest individual shareholder, Bruce Mathieson, collaborated on the rescue deal. With Mathieson reportedly committing $100 million of the total package, Bally’s final contribution is reduced to $200 million. Once converted, the notes would give Bally’s and Mathieson combined control of approximately 56.7% of the company on a fully diluted basis.
According to the Australian Financial Review, The Star was operating with just a week’s worth of cash when it first engaged with Bally’s in March, and was looking for ways to free up cash to stay afloat. The board has therefore recommended that shareholders vote in favour of the investment.
Bally’s chairman, Soo Kim, will join The Star’s board as an observer during the approval process. Kim has indicated that Bally’s plans to shift The Star’s focus back to the domestic market, aiming to serve Australian customers more effectively rather than targeting international high-rollers.
Bally’s operates 19 casinos across 11 US states and one in the UK, with a growing digital presence. The company has a track record of turning around underperforming gaming assets – experience it now hopes to apply in Australia. The lifeline deal marks a major shift in the ownership and direction of The Star, offering a potential path out of its current crisis.