8 hours Ago By Colin Kruger
Star Entertainment has gone into a trading halt after the board was unable to assure the market that it will be able to pay its bills as they fall due. The company said its shares will be paused from trading ahead of a further announcement. The company is scheduled to release its half-year results on Friday, the final day of corporate reporting season, but its board has been unable to sign off financial statements for the second time in six months.
The reported that the company had been unable to raise funding required to meet near-term payments, including for payroll, which puts the company at serious threat of running out of cash Following a board meeting Thursday afternoon that went late into the night, Star’s directors were not able to sign off on the casino operator’s December half-year results which were due to be announced Friday. Before signing the accounts, a board of directors must be satisfied that the company is a “going concern”. That is, the company can pay its debts as and when they fall due.
Star chief executive Steve McCann had unsuccessfully tried to coax lenders, state governments and investors into giving the embattled casino operator the time - and cash - needed to work through its challenges, though he was warning them it would take hundreds of millions of dollars to keep the company operating in administration. In September last year Star’s directors started getting advice on ‘safe harbour’ provisions provided by the Corporations Act that would protect them from being personally liable for debts in the event it cannot stay solvent. It is used when a financially struggling company is considering a last-ditch restructure attempt as an alternative to financial collapse and calling in the administrators.
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