The Star Entertainment Group has settled its long-running tax disputes with the Australian Taxation Office (ATO), securing a partial refund while drawing a line under its former junket business.
The disputes concerned the GST treatment of junket rebates between October 2013 and August 2017, as well as the calculation of withholding tax on payments made from July 2014 to June 2020. The Star had previously paid approximately AU$88 million to the Commissioner of Taxation while the matters remained under dispute.
Under the settlement, the Commissioner will refund approximately AU$33m to the company. Despite the reimbursement, The Star expects to recognise a one-off charge of around AU$55m for the financial year ending 30 June 2026.
The resolution removes another legacy issue linked to the group's former junket operations, which ceased in October 2020 as Australia's casino sector came under heightened regulatory scrutiny.
Separately, The Star has strengthened its financial position by securing a new US$390m refinancing package from funds associated with WhiteHawk Capital Partners.
The three-year facility will fully replace the group's existing AU$400m syndicated debt facility. Interest will be based on the Term SOFR benchmark plus a margin, producing an overall borrowing cost broadly in line with the company's previous financing arrangements.
The refinancing also introduces a series of financial covenants, including minimum liquidity requirements that increase over time, beginning at AU$50m during the first year and rising to AU$100m after 18 months. The agreement also requires the group to maintain a minimum asset coverage ratio of 1.40 times, with the first compliance test scheduled for 31 December 2026.
Together, the tax settlement and refinancing represent two significant financial developments for The Star as it continues efforts to stabilise its balance sheet and move beyond issues associated with its historical junket business.
The Star ended all dealings with junket tour operators in October 2020
