About $80 million of the equity will come from two of its partners in Brisbane’s $3.6 billion Queens Wharf casino development, Chow Tai Fook Enterprises and Far East Consortium.

The Office of Liquor and Gaming Regulation is investigating Chow Tai Fook’s suitability to hold an interest in the new casino after allegations were raised last year that it was allegedly involved in organised crime.

Star announced on Thursday it would raise the extra funds at $1.20 per share, a 21.1 per cent discount to its last trading price.

The equity raising was a condition of Star receiving covenant relief from lenders whom Star owed $1.3 billion as of December 31.

“We worked with our lenders for quite a while in securing the relief package and accommodating a range of scenarios,” chief financial officer Christina Katsibouba told analysts.

The equity raising will reduce Star’s net debt from $1.1b to $431m.

The company also announced it was taking an impairment charge of $988m on its Sydney casino, which has been underperforming following the Bell review and as the NSW government debates steep tax hikes on gaming tables and poker machines.

Star CEO and managing director Robbie Cooke told analysts that if those tax hikes went ahead in their current form it would cost Star about $100m a year, basically doubling its tax bill and forcing it to take “drastic measures”.

“What that would actually entail, we haven’t actually fully explored how we would deal with that,” he said.

“But it does put the business in a very very difficult position, and it would require very significant changes to the business.”

But Cooke added that he thought both political parties realised that the Star Sydney was a big employer – it has 4,000 workers – and that the tax plan in its current form was unsustainable.

“I’m optimistic whichever way the election plays out – and that’s not matter for me – that we can navigate a path through this, but I don’t know what it looks like,” Mr Cooke said.

Excluding the $988m impairment, Star declared a net profit after tax of $44m for the six months to December 31, on $1b of revenue.

“It’s a good result for the half, in choppy waters,” Mr Cooke told AAP.

Star’s Queensland properties performed strongly during the period, with the Star Gold Coast growing revenue to $276m, 30 per cent higher than its pre-Covid level in 2019/20.

But revenue from the Star Sydney was down 14 per cent on pre-COVID levels, at $541m.

Cooke said that roughly one-third of the Star Sydney’s underperformance came from increased competition, one-third from the impact of excluding patrons, and one-third from not being able to serve complimentary alcoholic beverages and other services.

The company has a submission to the NSW casino regulator that would allow it to resume giving out free drinks. “Hopefully that is resolved soon,” Cooke said.

So far in 2023, Star’s Gold Coast revenue is up 24 per cent versus 2020, Brisbane is up five per cent while Sydney is down 17 per cent. Overall total group revenue is down four per cent from 2020.

Looking ahead, Star said its Queen’s Wharf property was set to begin opening in December, comprising four hotels with 1,000 hotel rooms, more than 50 restaurants, bars and cafes, luxury retail, a 1,500-person ballroom, a sky deck and 7.5 hectares of public space.

“It’s pretty spectacular,” Cooke told AAP. “It’s a really exciting opportunity for the business.”

Construction of its second tower for the Star Gold Coast was on track for a 2024 opening, with all apartments pre-sold.

-with AAP