Star Entertainment Group Ltd (ASX: SGR) shares have yet to make an appearance on the ASX boards in September.
The embattled casino and resorts operator requested a trading halt last week for a number of reasons.
In case you missed it, here's what the company stated:
The reasons for the request are as follows:
i. The Star notes that the final report following the 2024 Independent Inquiry into The Star undertaken by Adam Bell SC (in accordance with the Casino Control Act 1992 (NSW) (the Report)) has today been provided to The Star and released by the NSW Independent Casino Commission (NICC). The Star is considering the Report and implications it may have for disclosures concerning its financial results for the year ended 30 June 2024 (FY24 Results);
ii. The Star is finalising other disclosures in relation to its FY24 Results; and
iii. The Star intends to respond to other matters raised in media articles referring to, among other things, The Star's FY24 Results and its financial and liquidity position.
The original trading halt request was until 2 September. However, this halt has since turned into a suspension by the ASX after Star failed to lodge the relevant periodic report by its due date.
What's the latest?
Star shares won't be returning to trade today, but it has released a market update to keep shareholders informed with what's going on.
According to the release, the company notes that there have been multiple media articles in respect of various matters including its financial and liquidity position and the implications of the report by Adam Bell SC following the 2024 Independent Inquiry into The Star.
In response to these matters, Star said:
The Star is currently reviewing its financial and liquidity position with various advisers in the context of seeking to finalise its preliminary financial report for the financial year ended 30 June 2024 (FY24), including holding discussions with various stakeholders in relation to its liquidity position in light of adverse trading and other conditions.
The Company confirms that the advice being provided has extended, from time to time, to considering the application of provisions of the Corporations Act 2001 (Cth) (including the safe harbour provisions).
What does this mean?
Star noted that it is considering the application of provisions of the Corporations Act 2001 (Cth), including the safe harbour provisions. But what does this mean?
Australia's leading independent law firm, Corrs Chambers Westgarth, explains:
The safe harbour provides directors with protection from liability for insolvent trading provided they have begun developing a course of action that is reasonably likely to lead to a better outcome for the company and the company's creditors than the appointment of a voluntary administrator or liquidator.
The safe harbour is intended to give directors breathing space to consider innovative solutions and to take reasonable, considered risks to restructure viable companies without necessarily exposing the company to the stigmatism of formal, public insolvency processes.
Clearly things are looking very dire for Star shares and its shareholders.
