JPMorgan sells stake in Australian casino operator Star Entertainment

JPMorgan, an investment banking juggernaut, has divested its stake in Star Entertainment, a leading Australian casino operator which has come under increased scrutiny and regulatory pressure in recent years.

JPMorgan bows out of beleaguered Australian casino giant

JPMorgan sold its 5.09% stake in the company according to a filing submitted to the Australian Stock Exchange earlier this month. This is the latest blow to Star Entertainment, following several long years of regulatory oversight and strict regulatory action that has identified serious breaches leading to multiple fines.

The company was fined AU$100m by the New South Wales Independent Casino Commission related to money laundering failures at the company’s property in Sydney. In October this year, the regulator also issued another A$15m fine over ongoing compliance failures.

In the filing signed by The Star Secretary Jenni Yuen, Star Entertainment said that it would not be barring any individual from having more than 10% stake in the company, as per current regulatory mandates established with the Liquor and Gamin New South Wales and the Queensland Office of Liquor and Gaming.

Star Entertainment shares face continued pressure

Since early 2023, Star Entertainment’s share price has been in a steady free fall, hitting a five-year low and trading at AU$0.1950 for a share, down from AU$4 in December 2020. The shares are not likely to start picking up any time soon either, as the company continues to face headwinds.

Crown Resorts, the Blackstone-owned larger rival of the Star Entertainment, finds itself in a seemingly unflattering position in the Australian casino market.

Both companies have had to reckon not only with regulatory interventions, but also try to manage a drop in tourism that has necessitated layoffs and revision of operations.

Image credit: Flickr (@Thomas Hawk)