Star Entertainment faces severe liquidity issues, with cash reserves dropping to AUD 79 million by the end of 2024, down from AUD 107 million in Q3. Morningstar analyst Angus Hewitt warns the company may not survive until its February 28, 2025 interim results without immediate financial intervention.

The company struggles to meet conditions for accessing a crucial AUD 100 million credit facility tranche, which requires securing additional subordinated capital of at least AUD 150 million. This crisis comes while all three major venues - The Star Sydney, The Star Brisbane, and the Star Gold Coast - remain under government control following anti-money laundering investigations.

Recent developments include JPMorgan Chase's complete divestment of its 5.47% voting stock, further dampening market confidence. While asset sales or finding a buyer could provide relief, analysts consider these options unlikely given the company's precarious position and weak market conditions.

Financial Options and Outlook:

• Potential equity raise of AUD 150 million at AUD 0.10 per share (30% below current trading price)
• Morningstar maintains an "extreme uncertainty" rating
• Price objective set at AUD 0.20
• 50% probability of entering administration
• Continued weak performance in carded play
• Limited access to debt markets

The combination of regulatory challenges, diminishing cash reserves, and a challenging Australian economic environment places Star Entertainment in a critical position requiring immediate strategic action to avoid administration.

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