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Speaker 1: From The Australian. Here's what's on the front. I'm Kristinamiot.

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Speaker 1: It's Tuesday, Marsha eleven, twenty twenty five. US President Donald

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Speaker 1: Trump unleashed on former Prime Minister Malcolm Turnbull on Monday,

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Speaker 1: Posting on his Truth social network, Trump said Turnbull was

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Speaker 1: a weak, ineffective leader who led Australia from behind and

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Speaker 1: who failed to understand what was going on in China.

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Speaker 1: The president's lashing was in response to a TV interview

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Speaker 1: in which Malcolm Turnbull said the US was becoming an

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Speaker 1: increasingly unreliable ally. An energy provider backed by Greenpeace has

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Speaker 1: been accused of misleading and deceptive conduct to the tune

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Speaker 1: of more than one hundred million dollars. An audit of

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Speaker 1: Diamond Energy's operation has raised serious questions over its renewable

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Speaker 1: energy claims. You can read that exclusive story right now

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Speaker 1: at The Australian dot Com dot com. Star Entertainment has

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Speaker 1: been saved from failure by not one, but two eleventh

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Speaker 1: hour takeover bids. The embattled gaming operator has a choice

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Speaker 1: between a known quantity and an unbidden white night. That's

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Speaker 1: today's episode.

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Speaker 2: The first time I went to Bally's in twenty thirteen.

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Speaker 2: It was a great experience stayed in the Garden Tower then,

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Speaker 2: and I can remember the rooms being nice and big.

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Speaker 1: This is a review of the Bally's Atlantic City Hotel

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Speaker 1: and Casino written on the travel rating website trip Advisor

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Speaker 1: back in twenty sixteen. We've used an AI voice generator

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Speaker 1: to bring it to life.

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Speaker 2: Stark difference now terrible service, terrible management, terrible maintenance or

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Speaker 2: lack thereof, And I understand the company is being destroyed

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Speaker 2: by bankruptcy.

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Speaker 1: In twenty twenty, the iconic casino company Caesar's Entertainment offloaded

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Speaker 1: the embattled New Jersey establishment to another gaming outfit as

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Speaker 1: part of a package deal with two other casinos. An

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Speaker 1: Atlantic City casino will have new owners, a new look.

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Speaker 3: And a new future.

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Speaker 1: New Jersey gambling regulators gave approval to a Rhode Island

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Speaker 1: company to operate Bally's casino. The former president and CEO

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Speaker 1: of Bally's Corporation, George Papania, said he hoped his company

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Speaker 1: would be able to restore Bally's Atlantic City, at the

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Speaker 1: time the city's worst performing casino, to its former glory.

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Speaker 1: Its acquisition was part of a multi year shopping spree

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Speaker 1: for Bally's, which now operates nineteen casinos across the United

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Speaker 1: States and has a pretty decent track record of turning

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Speaker 1: around ailing establishments like the one in Atlantic City. But

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Speaker 1: on Monday morning, the attention of Bally's bosses was trained

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Speaker 1: not on America but on Australia. Star Casinos.

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Speaker 4: But today cave a bombshell in the shape of US

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Speaker 4: casino operate up bally It launched an unsolicited, non binding

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Speaker 4: proposal to provide Star with additional funding.

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Speaker 1: The Star casino is a twenty four hour a day,

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Speaker 1: seven day a week operation. Its gaming floors rarely close,

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Speaker 1: but while guests wined, dined, and placed bets on Friday night,

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Speaker 1: its bosses were fighting for the Star's life. Without an

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Speaker 1: urgent injection of funds, the gaming company could well have

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Speaker 1: been in administration by Monday morning, leaving its nine thousand

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Speaker 1: employees without a job. The fifty three million dollar lifeline

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Speaker 1: came from Hong Kong investors, Far East Consortium International and

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Speaker 1: Chow Tai Fook Enterprises. They offered Star the more than

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Speaker 1: fifty million dollars in cash in exchange for its share

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Speaker 1: in the brand spanking new Queen's Warf casino.

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Speaker 5: It's a pretty radical proposal to try and save the company,

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Speaker 5: which pretty much it was one minute to midnight for Star.

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Speaker 1: Eric Johnston is an associate editor with The Australian.

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Speaker 5: This transaction offered an immediate injection of a couple of

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Speaker 5: million dollars into Star and also what it did it

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Speaker 5: got Star out of its biggest problem, which was Brisbane.

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Speaker 5: This was now becoming a real millstone for Star on

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Speaker 5: its balance sheet. So while it's safe Star, it was

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Speaker 5: still a bad deal in the sense that Star didn't

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Speaker 5: have any options left. It had to make this deal,

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Speaker 5: so in order to survive, it had to get rid

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Speaker 5: of its most lucrative and asset that offers most upside.

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Speaker 5: It wasn't a great deal, but Star was running out

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Speaker 5: of money. It was running out of cash. It had

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Speaker 5: to sign off and by doing that, it threw its

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Speaker 5: best asset into the pot, into the mix. In order

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Speaker 5: to do that, Star has now escaped the future obligations.

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Speaker 5: So there's still a lot more money and debt sitting

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Speaker 5: in this Brisbane complex that it was exposed to and

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Speaker 5: that was a thing that was sinking it fifty three

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Speaker 5: million to stay alive. Look, when you're in a corner,

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Speaker 5: and then any lifeline is a lifeline, and Star survived

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Speaker 5: yet again.

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Speaker 1: After months of financial negotiations with investors and lenders around

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Speaker 1: the globe, the Hong Kong deal appeared to be the

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Speaker 1: best the Star could hope for, but the Queensland government

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Speaker 1: didn't have time to consider approving it before Bally's swooped in,

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Speaker 1: led by self described corporate fireman CEO su Kim on

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Speaker 1: Monday morning.

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Speaker 5: We all thought it was done in dustin. This is

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Speaker 5: a story two years in the making and it's had

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Speaker 5: so many twists and turns every part of the way.

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Speaker 5: And right on que Monday morning, a year US casino

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Speaker 5: operator bally It emerged out of nowhere and said, hey,

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Speaker 5: we've been following staff for a little while. We've done

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Speaker 5: our own numbers. They sent a letter to Stars chairman

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Speaker 5: and ward on Monday and said, look, we've got a

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Speaker 5: rival proposal. Rather than you take all this financing under

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Speaker 5: your deal that you did on Friday night, we'll off

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Speaker 5: to tip in some money and work with you. We

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Speaker 5: want you to be intact, hang on to Brisbane and

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Speaker 5: we can find a way to move forward. So in

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Speaker 5: a way that brings Star back to square one. It's

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Speaker 5: two hundred and fifty million dollars. It's probably not enough

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Speaker 5: to get Star where it needs to be at this moment.

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Speaker 1: Why do you think this kind of struggling operation is

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Speaker 1: attractive to a company like Bali's. This is arguably more

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Speaker 1: of a gamble for them than the Hong Kong investors

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Speaker 1: who already have a stake in the Queensland operation.

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Speaker 5: It offers potential, So for any business operator, You're right,

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Speaker 5: it is a gamble, but it does offer some upsides. Brisbane,

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Speaker 5: You've got a brand new casino in one of Australia's

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Speaker 5: fastest growing cities. This city is going to be hosting

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Speaker 5: the Olympics at the end of the decade. It's going

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Speaker 5: to be the center of the world. And here's an

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Speaker 5: opportunity to get a really big stake in this on

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Speaker 5: the ground floor at a really beaten down price, really

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Speaker 5: cheap price. So why not? And what bally is offering

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Speaker 5: is not much. If Bally's does go ahead, which is

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Speaker 5: still a long way to go, and we think that

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Speaker 5: Star would probably push back on it.

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Speaker 1: Star insiders told the Australians Glen Norris, the big wigs

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Speaker 1: are leaning towards the Hong Kong investor deal. So what

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Speaker 1: happens next.

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Speaker 5: We don't know, because every time we thought we'd come

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Speaker 5: to a conclusion with Star, it certainly has had the

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Speaker 5: capacity to surprise and come out with something else. At

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Speaker 5: this stage, there is a determination by Star to keep

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Speaker 5: pushing ahead with the deal that are sorted out on

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Speaker 5: Friday night, so it really wants to get rid of Brisbane.

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Speaker 5: You can't see a way forward with all this financing obligations.

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Speaker 5: It fears that the further costs might blow out. It

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Speaker 5: was budgeted at three billion, it fears it could be

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Speaker 5: going up to four billion, maybe even more. The initial

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Speaker 5: activity in Brisbane has just been underwhelming, so it's not

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Speaker 5: making enough money at the moment to pay even the

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Speaker 5: interest rate bills that Star has on its obligations are.

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Speaker 5: It hasn't got final sign off from regulators, although it

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Speaker 5: has received in principal support from Queensland. There's still a

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Speaker 5: lot of hoops for it to go through. It's bankers

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Speaker 5: which are really running the process. They haven't approved so

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Speaker 5: they might come up with a better deal with Bali.

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Speaker 5: There's a lot of twists and turns yet to play

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Speaker 5: out on this one, and I don't think we've seen

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Speaker 5: the end of it yet.

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Speaker 1: Coming up where Star Casino's money troubles started. Star Entertainment

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Speaker 1: Group is in the spotlight again tonight with a new

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Speaker 1: inquiry announced to determine if it's suitable to hold a

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Speaker 1: casino license. If you had to pick one, this would

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Speaker 1: probably be the moment things started to go south for

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Speaker 1: Star Entertainment. In twenty twenty one, the New South Wales

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Speaker 1: Independent Casino Commission ordered Esteemed Sydney silk Adam Bell to

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Speaker 1: look under the hood of the company's Sydney operation. Across

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Speaker 1: two inquiries carried out over several years, he found evidence

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Speaker 1: of fraud, money laundering, compliance breaches and a company culture

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Speaker 1: in dire Straits.

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Speaker 3: Australia's second biggest casino operator, has been found unfit to

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Speaker 3: hold a casino license in Sydney. The state's Independent Casino Commissioner,

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Speaker 3: Philip Crawford, called the resulting report shocking.

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Speaker 4: The institutional arrogance of this company's boonebreadth tychy and their

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Speaker 4: willingness to take risks of pursuing financial goals as born appalling.

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Speaker 1: The Star's license was spared at the conclusion of the

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Speaker 1: second Bell inquiry in twenty twenty four, but it was

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Speaker 1: slapped with a record fine and a slew of sanctions.

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Speaker 1: Its former CEO Robbie Cook and chair David Foster left

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Speaker 1: the company in the fallout. Jobs were slashed and assets

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Speaker 1: sold off after Star Entertainment posted a staggering one point

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Speaker 1: seven billion dollar loss. By January, the company had less

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Speaker 1: than one hundred million dollars in the bank and no

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Speaker 1: cards left to play. Here's Eric Johnston.

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Speaker 5: There's an old saying, when you go to casino, there's

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Speaker 5: no point because the house always wins. How casino lose money?

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Speaker 5: How could casino be sitting on the brink of administration.

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Speaker 5: It's a fairly sad story. But Star in itself is

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Speaker 5: its own worst enemy, as well as the fact that

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Speaker 5: it's been caught in a perfect storm. It signed off

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Speaker 5: on this really big, ambitious, three billion dollar Brisbane project.

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Speaker 5: This was before COVID and this was signed off in

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Speaker 5: the time when Australian casinos, including Crown which operates in

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Speaker 5: Melbourne and Perth, were out there encouraging high rollers from

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Speaker 5: Asia all across Asia, including China, to come to the

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Speaker 5: casino and gamble big dollars.

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Speaker 2: It was a really.

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Speaker 5: Lucrative trade anything meant in the casinos, and since then

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Speaker 5: there's been a lot of focus on the way that

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Speaker 5: the casinos behaved or didn't behave, which was trying to

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Speaker 5: keep the bad elements out of their operations. Star just

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Speaker 5: has not been able to get ahead. Now it's been

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Speaker 5: at loggerheads with the New South Wales regulatory as well.

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Speaker 5: Then what we've seen is that it's drifted off the

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Speaker 5: track in terms of its finances, and then this Brisbane

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Speaker 5: issue suddenly turned into a very big and very real issue,

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Speaker 5: the cost blowouts on the building project. It had to

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Speaker 5: keep tipping more money in. So there's all this in

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Speaker 5: New South Wales and we had a move to cashless

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Speaker 5: gaming and you've just seen activity in Stars Sydney casino

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Speaker 5: just fall off a cliff. At the same time as

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Speaker 5: all the pubs and clubs which aren't regulated by cashless gaming,

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Speaker 5: you've seen their activity starting to boom because everyone's just

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Speaker 5: going across there. Stars having cash flow problems here in Sydney,

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Speaker 5: it's paying all these bills in Queensland. It can't fix itself.

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Speaker 5: So suddenly you've seen it in a very bad spot

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Speaker 5: until it's had this cash crunch and now it's in

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Speaker 5: a really bad spot.

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Speaker 1: Why does it matter if the Star survives or doesn't survive.

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Speaker 5: It's a good question. It does employ a lot of people,

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Speaker 5: nine thousand people across two states Southwells and Queensland. There's

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Speaker 5: one hundreds, maybe even thousands of suppliers, just even small

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Speaker 5: local suppliers, restaurants. There's the assets, tourism assets because they

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Speaker 5: operate big hotels, so tourism does rely on these things.

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Speaker 5: If it did go under, an administrator would just come in.

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Speaker 5: There is a risk that it might think this business

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Speaker 5: hasn't got a future, We're just going to shut it down.

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Speaker 5: They have to look at it really ruthlessly. They might

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Speaker 5: just carve it up. Then certainly you're going to have

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Speaker 5: all these other new casino operators which have to pass

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Speaker 5: their own probity test. So it does come with a

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Speaker 5: lot of unknowns in terms of administration, but mostly those

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Speaker 5: nine thousand workers that turn up every day, that's a

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Speaker 5: big sort of risk for them.

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Speaker 1: Eric Johnston is an associate editor with The Australian. You

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Speaker 1: can read all the latest on Star Entertainment's future, as

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Speaker 1: well as all the nation's best business news right now

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Speaker 1: at The Australian Dot com dot au,