Based on all the available information and the latest take over bid from Ballys, what would be the expected share price on opening and reasons why? Ballys had paid a conversion rate of 8 cents per share would this be the expected price or is that calculation to simple?
The offer mentions
April 2025$300 MILLION STRATEGIC INVESTMENT INTO THE STARThe Star Entertainment Group Limited (ASX: SGR) (The Star, the Group or the Company) announcesthat today the Company has entered into a binding term sheet with Bally’s Corporation (Bally’s) withrespect to a multi-tranche convertible note and subordinated debt instrument (the Investment) with anaggregate principal value of $300 million (the Transaction). A copy of the binding term sheet with Bally’sis attached.Details of the Transaction• Amount: $300 million• Timing of funding
$100 million is expected to be paid to The Star on or before 9 April 2025 (subject to receiptof required consents from The Star’s senior lenders) (Tranche 1)o $200 million paid to The Star following a shareholder vote (if shareholders approve theTransaction) and regulatory approvals, or $100 million paid to The Star following theshareholder approval with a further $100 million paid following the receipt of all requiredregulatory approvals (but no later than 7 October 2025 if regulatory approvals areoutstanding) (Tranche 2)• Securities Offered
Tranche 1: Tranche 1A Notes: Convertible into shares representing 9.71% of The Star’s pre-issue capital – $22.3 million Tranche 1B Notes: Convertible into shares representing 4.85% of The Star’s pre-issue capital – $11.1 million Tranche 1C Subordinated Debt: Subordinated non-convertible debt of $66.6million. This amount may be increased in certain circumstances, including ifregulatory approvals related to the issuance and conversion of the Tranche 2Notes are not obtained within specified periodso Tranche 2 Notes: when aggregated with Tranche 1, Tranche 2 Notes will be convertibleinto 56.7% of the issued capital of the Company on a fully diluted basis• Coupon: 9.0% per annum, compounding and payable quarterly in arrears, that can be paid incash or paid in kind.• Conversion Price: The conversion price for all Notes (Tranche 1A, Tranche 1B and Tranche 2)is 8 cents per share subject to customary adjustments as set out in the binding term sheet.• Security: Unsecured and subordinatedSTARENTERTAINMENTGROUP.COM.AUT + 61 7 3228 0000THE STAR ENTERTAINMENT GROUP LTDABN 85 149 629 023Page 1 of 2• Approval requirements
Tranche 1 is not subject to shareholder or other approval. The Tranche 1 Notes willcomprise the Company’s existing placement capacity and the balance of the investmentwill be by way of subordinated debt.o Tranche 2 is subject to shareholder approval (being an approval under section 611 item 7of the Corporations Act), approval from the Foreign Investment Review Board, probityapproval being received by Bally’s in New South Wales and Queensland, confirmationfrom ASX under Listing Rule 6.1, continued compliance with the Company’s existingsenior lender facility and entry into long form documentation.• Maturity: 2 July 20291The Company is engaging with the Company's largest shareholder, Investment Holdings Pty Ltd (which iscontrolled by the Mathieson family), in relation to a possible subscription by Investment Holdings Pty Ltdof up to $100 million of the Investment. If this occurs, the investment from Bally’s would reduce to$200 million.Next stepsThe Board of The Star intends to unanimously recommend that The Star shareholders vote in favour ofthe Transaction, in the absence of a superior proposal and subject to an independent expert concluding(and continuing to conclude) that the Transaction is in the best interests of The Star’s shareholders. EachDirector of The Star intends to vote all of The Star shares that he or she holds or controls in favour of theTransaction, subject to those same qualifications.A booklet containing information relating to the Transaction, reasons for The Star Directors’recommendation, an independent expert’s report and details of the shareholder meeting will be preparedand provided to the Australian Securities and Investments Commission for review, and subsequently sentto The Star shareholders in due course.The Star is targeting to dispatch a booklet in late May 2025 to shareholders. Shareholders will have theopportunity to vote on the Transaction at a shareholder meeting which The Star is currently targeting tohold in late June 2025.Separately, the Directors are currently finalising The Star’s financial accounts for the period ended31 December 2024 and intend to lodge those accounts with ASX as soon as possible.The Star shareholders do not need to take any action at this stage.
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