Star gambled on high rollers in Brisbane, now it’s losing its shirt to its Chinese partners

On the evidence that is available, certain assumptions could be made further to the Synergies report or Darren Cartwright’s article. If any further evidence was needed as to how aggressive the casino will need to be in the Queensland domestic market, you need look no further than the Star Entertainment Group 2023 Annual Report which reported the statutory net loss after tax of $2.4bn. As demonstrated in the Queensland Casino Control and Other Legislation Amendment Bill of 2023, will significantly impact on the original projected revenues for the Brisbane casino. The variance in these two assumptions highlights the uncertainty of the casino’s potential impact. The latest Synergies report (commissioned by Clubs Queensland) indicated that the reduction in community contributions by the Club industry could be in the order of $8.36 million, significantly less than Darren Cartwright’s assumption. The deal, as well as a $250 million cash injection secured from US casino giant Bally’s Corporation in April, helped Star stave off administration.
Star will have to repay the joint venture partners $10 million in proceeds by August 6 and $31 million in equity contributions by September 5. But right now, Star is doing everything except showing workers the respect they deserve.” She warned action will escalate unless the company comes to the table with a fair offer. “The last 18 months have been filled with uncertainty, but Star workers are not backing down”, Schofield said. The union said staff are being paid close to minimum wage, despite regularly stepping up to perform higher duties. Regulators are still considering substantial penalties, which could push the company closer to collapse. But the company behind it, The Star Entertainment Group, is facing serious financial instability.
A senior Chow Tai Fook executive did that for them, and was able to arrange funding without their involvement. When he died in 2018, Chow Tai Fook bought back his stake and sold it to one of its finance managers. One of the men, a billion-dollar Chow Tai Fook shareholder and co-founder of its jewellery business, was loaned the money on a “handshake” and charged no interest.
Cheng said the deal wasn’t going ahead because of Suncity’s poor finances — not because due diligence had uncovered anything shady about Chau. He was barred from any involvement in the Brisbane venture — and died the following year. It got even messier when the ABC exposed its hidden ties to Chau seven years later, sparking a government investigation.
There is so much talk, theories, reports, and misinformation about the potential impact of the new Brisbane casino on the Queensland Club and Hotel industry, it’s difficult for anyone to get a clear understanding of what the impact may be. The Brisbane Queen’s Wharf development deal announced in March consisted of Star’s 50 per cent stake in exchange for a $50 million cash injection. They also say management refuses to match redundancy conditions available to workers at Star Sydney. The rescue deal was meant to stabilise the business but is now in doubt after key Hong Kong partners withdrew their support, raising fresh concerns about Star’s future.
It had just won a bid to build a new casino complex so expensive, a former Queensland treasurer said it would “have to attract Asian tourists” to justify the investment.
He blamed a “misunderstanding” with Chow Tai Fook management for having a stake in the casino with Chau in the first place. Queensland regulators believed Hong Kong tycoon Cheng Yu Tung, pictured here in 2011, was too elderly to have any influence on his family’s involvement in the Brisbane casino. The investigation report, released last month by the Crisafulli government, shows the original probity checks raised red flags. For anyone to suggest that the casino will have little to no impact on the Queensland Club and hotel industry would be naïve, and it couldn’t come at a worse time. If we use the estimated investment return of $175 million per annum plus an additional $175 million to make up some losses, we could assume that the additional profit the casino may be looking for could be in the order of $350 million.
I have been part of the company for over 21 years, serving in various capacities. The young dealer expertly and patiently counts the pile of crisp notes – $5000. But like at Hoiana, where Chow Tai Fook took a controlling stake with Chau out of the picture, the real money spinner in Brisbane could be the development around the casino. “Junket business normally would have complications in the background… this could involve illegal activities, association with triads or even being triad members themselves,” he said. In his interview with the regulator in November 2023, Chow Tai Fook chairman Henry Cheng denied the conglomerate was “financing the Vietnam project” — rather it had given personal loans to friends. Chow Tai Fook Jewellery chairman Henry Cheng Kar-shun, holds a souvenir during the trading debut of the company at the Hong Kong Stock Exchange December 15, 2011.