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Investing.com-- Shares of Star Entertainment Group Ltd (ASX:SGR) climbed on Wednesday after the company announced the sale of its Star Sydney Event Centre for A$60 million ($37.51 million), a move aimed at strengthening its financial position amid ongoing liquidity challenges.
The transaction, which involves selling the venue to Foundation Theatres, is expected to convert the space into a Broadway-style theatre with a seating capacity of 1,550. The new facility is anticipated to enhance foot traffic to the casino, benefiting Star’s overall operations.
Star shares rose as much as 13% to A$0.13 in early trade and were 4.5% higher as of 03:12 GMT.
The Australian casino company, grappling with financial strain, had reported cash reserves of A$79 million at the end of December, having spent over A$100 million in the last quarter.
To bolster its balance sheet, the company has been divesting assets, including the recent A$67.5 million sale of the Treasury Casino (EPA:CASP) leasehold in Brisbane. Further asset sales, including hotel properties in Sydney and on the Gold Coast, are under consideration.
The company is also contending with regulatory scrutiny.
"We continue to work on a number of other potential non-core asset transactions." CEO Steve McCann said in a statement.