Distressed debt juggernaut Oaktree Capital’s dealmakers are dusting off their notes on long-time target Star Entertainment, joining other opportunistic investors licking their lips on the sidelines as CEO Steve McCann scrambles to keep the lights on at its casinos.
Street Talk can reveal Oaktree’s local suits have refreshed their modelling on Star’s prospects in recent months after the casino giant revealed it was struggling despite being propped up by billions in emergency funding over the past two years. Sources said Oaktree was working with White & Case partner Timothy Sackar and MA Financial Group co-chief executive Chris Wyke on its proposal.
Of note, Oaktree hasn’t lobbed an offer to Star or its lending syndicate. But it is understood to be actively monitoring the situation and is reasonably advanced in its efforts, ahead of special situations rival Cerberus Capital Management.
It is also worth noting that distressed debt investors of Oaktree’s ilk typically strike when a company’s debt is worth as little as 30¢ to 40¢ on the dollar, not when it is in the 80¢ to 90¢ range as has been the case with Star over the past year. Recent blow-ups at GenesisCare and Accolade Wines were similar.
Read the full story tomorrow and more on the Street Talk page.
Melbourne-headquartered Fabric Group has drafted in PwC’s dealmakers to test market appetite and find it a like-minded partner. This follows several external approaches made to the founders by private equity players.
Best and worst
Australian shares narrowly missed resetting a record high on Wednesday after inflation cooled faster than expected, fuelling hopes of a rate cut from the Reserve Bank of Australia next month.
