Star mops up insto leg of $750m raise; Mathieson’s stake unclear

Star Entertainment Group had no trouble luring in takers for its equity raising, but as of Tuesday night, its largest shareholder Bruce Mathieson’s appetite for the deal was a mystery to fund managers.

Sources said Mathieson, who owns 9.97 per cent of Star, was expected to wait until the evening to decide how much he would tip in. The book closed with strong demand at 12pm.

It would be highly unlikely for Mathieson to forgo his share of the rights issue, with fund managers expecting him to take up enough to stay just under the 10 per cent threshold. However, the delay wasn’t surprising given he stumped up $1.20 a share just six months ago. There were also questions about how much another shareholder, Chow Tai Fook, would tip in.

Fund managers were expecting allocations late Tuesday. As flagged by Street Talk, Star has also secured a $450 million debt package backed by Westpac and Barclays. Together, the equity and debt package would eliminate Star’s existing loans, which were part bank debt/part US private placement bonds.

The offer price was a 20 per cent discount to Star’s 75¢ last traded price. It is also substantially lower than the $1.20 a share at which Star last tapped equity capital markets for $800 million in February.