Soul Patts checks out Star’s refinancing, courts Mathieson as partner

afr.com:

Washington H Soul Pattinson is one of the parties working on troubled casino operator Star Entertainment’s debt refinancing, and is primed to stand toe-to-toe with a heavyweight consortium led by distressed debt giant Oaktree Capital.

Casino operator Star has almost zero chance of convincing banks to support its refinancing, sources reckon.  Brent Lewin

It is understood the ASX-listed $11.7 billion conglomerate has held talks regarding a tie-up with pubs and pokies billionaire Bruce Mathieson, who swooped on 9.97 per cent of Star including via an $800 million emergency capital raise in late February.

Sources said both Soul Patts and Mathieson were keen to come out and play in the refinancing. However, they were expected to wait for more details about what size the fine levied by the financial crimes watchdog on Star will be, as well as any changes to the NSW tax regime for pokies operators. Last month, Star rival Crown Resorts agreed to a $450 million penalty for its breaches of anti-money laundering and counter-terrorism financing laws. Star has provisioned $150 million.

Both parties have been in-and-around the business for months. While Mathieson’s participation in the equity raising is well known, it’s understood Soul Patts also picked up a slice of stock.

Star’s $1.3 billion gross debt at December end (split as $685 million in bank debt and $584 million in US private placements) is a key talking point among debt investors amid heightened leverage, slowing discretionary spending and a tougher regulatory landscape. At this point, Star’s odds of getting banks to lend to it again look almost zero.

As Street Talk has previously reported, Oaktree Capital – fresh off wedging itself into distressed cancer care provider