Star Entertainment Group Ltd (ASX: SGR) stockholders are enjoying a welcome day of outsized gains today.
The Star Casino share price closed yesterday at 11.5 cents. In earlier trade, shares in the S&P/ASX 200 Index (ASX: XJO) casino operator just leapt to 13.0 cents, up 13.0%. After some likely profit-taking, shares are changing hands for 12.25 cents apiece at the time of writing, up 6.5%.
For some context, the ASX 200 is up 0.6% at this same time.
Here's what's piquing investor interest on Wednesday.
Star Casino share price lifts on divestment
ASX 200 investors are bidding up the Star Casino share price after the embattled company announced a major divestment.
The company reported that its wholly owned subsidiary, Star Entertainment Sydney Properties, has executed an exclusivity arrangement and binding term sheet to divest The Star Sydney Event Centre and other spaces within The Star Sydney complex to Foundation Theatres.
The price tag for the assets is around $60 million, money sorely needed to keep the cash-strapped company afloat. Management noted that the transaction remains subject to a number of customary conditions, including relevant government and regulatory consent, as well as the finalisation of long-form transaction documents.
Commenting on the divestment that's lifting the Star Casino share price today, CEO Steve McCann said, "The Star has worked closely with the team at Foundation Theatres since they acquired the sublease for the Sydney Lyric in 2011."
McCann added:
We are pleased to partner with them as part of the continued evolution of our broad entertainment offerings at The Star Sydney. We continue to work on a number of other potential non-core asset transactions.
What's the latest from the ASX 200 casino operator?
After a horror year in 2024, 2025 hasn't given stockholders much to cheer about yet.
Last Monday, 20 January, the Star Casino share price crashed 17.9% on the heels of the company's second-quarter update.
Investors were favouring their sell buttons after the company reported a 15% quarter on quarter drop in revenue to $299 million.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) improved over the quarter but still came in at a loss of $8 million (excluding significant items). That was up from an EBITDA loss of $18 million in the prior quarter.
Noting the company's reduction in available cash to $78 million at the end of the quarter, management warned that with "ongoing financial and liquidity challenges", Star was continuing to explore other possible liquidity solutions.
"In the absence of one or more of those arrangements, there remains material uncertainty as to the group's ability to continue as a going concern," management warned.
Despite today's boost, the Star Casino share price is still down a painful 76% from this time last year.
