The Star has pulled out of its $3.6 billion Queen’s Wharf stake sale just days after shareholders approved a $300 million rescue by US casino giant Bally’s.

In a statement to the ASX, Star confirmed its Hong Kong partners, Far East Consortium and Chow Tai Fook Enterprises, have issued formal notice to terminate the deal which would have seen them take full control of the Brisbane mega-project.

The termination kicks in five business days after June 30 unless a new deal is struck.

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The move ends plans for Star to offload its 50 per cent share in Queen’s Wharf in exchange for a bigger slice of a Gold Coast venture.

Star said key commercial issues could not be resolved.

Far East Consortium has now demanded a $10 million repayment within 30 days or Star risks losing its 33.3 per cent stake in Tower 1 (Dorsett).

Bally’s steps in

The failed sale could open the door for Bally’s to reshape the struggling casino operator.

The US company gained a 38 per cent stake in Star last week through a $300 million investment and is pushing for a more unified strategy across the group’s Queensland assets.

“It was the announcement of the DBC agreement that served as the impetus for Bally’s to make public our interest in The Star,” Bally’s said on Tuesday.

“Without speaking to the specifics of the negotiation which we have not been privy to, we will reiterate the optimal outcome for all stakeholders is for the two Queensland properties to be managed as a single business.”

In simple terms, Bally’s is hinting it wants to step in, bring the two casino operations (Queen’s Wharf and The Star Gold Coast) under one roof, and possibly take over in future.

Bally’s said it would help the business run more smoothly and potentially make it more profitable — but it is not making any direct moves just yet.