JPMorgan, a major player in investment banking, has sold its shares in Star Entertainment, a prominent Australian casino operator facing intensified scrutiny and regulatory challenges in recent years.
JPMorgan bows out of beleaguered Australian casino giant
JPMorgan has sold its 5.09% stake in the company, as indicated in a filing submitted to the Australian Stock Exchange earlier this month. This represents the latest setback for Star Entertainment, which has endured years of regulatory scrutiny and enforcement actions that have uncovered serious violations, resulting in multiple fines. The company faced a penalty of AU$100 million from the New South Wales Independent Casino Commission for money laundering failures at its Sydney property. Additionally, in October, the regulator imposed a further A$15 million fine for ongoing compliance deficiencies. In the filing signed by Star Secretary Jenni Yuen, Star Entertainment stated that it would not restrict anyone from holding more than a 10% stake in the company, in accordance with current regulatory requirements established by Liquor and Gaming New South Wales and the Queensland Office of Liquor and Gaming.
Star Entertainment shares face continued pressure
Since the beginning of 2023, Star Entertainment’s stock price has been consistently declining, reaching a five-year low of AU$0.1950 per share, down significantly from AU$4 in December 2020. It appears unlikely that the shares will recover anytime soon, as the company continues to face ongoing challenges. Crown Resorts, owned by Blackstone and a larger competitor of Star Entertainment, is also in a challenging position in the Australian casino market. Both companies are grappling with regulatory interventions while also attempting to manage a decline in tourism, which has led to layoffs and operational adjustments.
