Bally's Corporation enters into a binding agreement with The Star for AUD 300 Million Strategic Capital Investment via Convertible Notes and Subordinated Debt

Core Viewpoint - Bally's Corporation has entered into a binding term sheet with The Star Entertainment Group for a strategic capital investment of AUD $300 million (approximately USD $187 million) through subordinated convertible notes and subordinated debt [1][7]. Transaction Overview - The transaction involves a multi-tranche issuance of notes with an aggregate principal value of AUD $300 million [1][7]. - Bally's will invest in two tranches, with the first tranche including convertible notes and subordinated debt [7][14]. - Upon conversion of the notes, Bally's could own approximately 56.7% of The Star's fully diluted share capital [5][7]. Strategic Intent - The transaction aims to revitalize The Star's operations and enhance its long-term potential, leveraging Bally's operational expertise [4][5]. - Bally's intends to work collaboratively with regulators and stakeholders to support The Star's turnaround [4][6]. Financial Details - The first tranche includes: - Tranche 1A: AUD $22.3 million (approximately USD $13.9 million), convertible into shares representing 9.71% of The Star's pre-issue capital [7][14]. - Tranche 1B: Convertible into shares representing 4.85% of The Star's pre-issue capital [7]. - Tranche 1C: Subordinated non-convertible debt of AUD $66.6 million (approximately USD $41.5 million) [14]. - The second tranche consists of AUD $266.6 million (approximately USD $166.2 million), convertible into shares representing 50.3% of The Star's pre-issue capital [14]. Approval Process - The issuance and conversion of certain tranches of notes are subject to shareholder and regulatory approvals [6][8]. - A shareholder meeting is expected to be held by The Star in the coming months [6]. Company Background - The Star Entertainment Group is a leading Australian entertainment and gaming company, operating casino and resort properties in major cities [3][10]. - Bally's Corporation operates 19 casinos across 11 states in the U.S. and has a growing international presence [12][13].