Star Entertainment's Queen's Wharf stake exit deal collapses
Australia's Star Entertainment said it had received a notice from Hong Kong's Far East Consortium International and Chow Tai Fook Enterprises to terminate the deal to sell its 50 per cent stake in its Queen's Wharf project in Brisbane.
The termination is set to take effect five business days from June 30, unless withdrawn earlier.
The March 7 agreement outlined the casino operator's planned exit from its equity interest in Destination Brisbane Consortium (DBC), but the parties had not resolved outstanding key commercial issues of the deal as of this morning, Star said in a statement on Monday.
Shares of Star were, however, up 1.7 per cent at A$0.147, as of 0104 GMT.
The casino and hotel complex was developed for A$3.6 billion ($2.35 billion), Star's website says.
For years, Star and Blackstone-owned larger rival Crown Resorts have faced multiple inquiries into anti-money laundering rule violations and subsequent legal actions.
Had the deal gone through, Far East Consortium and Chow Tai Fook Enterprises were set to become the sole owner of the Brisbane venture, which has luxury hotels and restaurants and other amenities.
Star was, in turn, set to take on the investors' 66.67 per cent stake in a Gold Coast project in Queensland.
In a separate statement, property developer Far East Consortium said that Star must repay A$10 million within 30 days of termination, failing which it must transfer its 33.3 per cent stake in Tower 1 (Dorsett) to the Hong Kong parties.
"Despite the receipt of this notice, The Star remains willing to continue negotiations with the Joint Venture Partners to give effect to the DBC transaction," Star added.
($1 = 1.5314 Australian dollars)
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