The second is to produce a sufficiently credible plan that provides the shareholders and lenders with a road map to recover their investment – and one that will give regulators sufficient comfort that the casinos can reform and retain its licences. The governments in NSW and Queensland need to know these large employing casinos won’t close and upset their local economies, and can only again become tax-milking machines.

The bottom line is McCann needs to have someone inject some money into Star, enough to keep the doors open until he can attract the cost base and sell assets.

To add to all this complexity, the current malaise in Star’s earnings – which really started to hit hard in the current financial year – since the start of July has other ramifications.

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The cost of reforms and newly implemented regulations around cashless gaming and carded play (which requires patrons to turn over lots of identity information) is a revenue retarder for the casino. It is disproportionately detrimental for Star over Crown as the former has poker machines.

Also when a company is making little or no profit, there are accounting ramifications – including an auditor-required need to take major write-downs on the value assets – and, in Star’s case, this is estimated to be around $1.4 billion.

And that’s a big number given the market capitalisation of Star (which is the amount the stock market values it at) is now $1.3 billion.

The bottom line is McCann needs to have someone inject some money into Star, enough to keep the doors open until he can attract the cost base and sell assets.

Shareholders are less than enthusiastic at such a prospect, thanks largely to having tipped in $1.6 billion over the past 18 months as the cash-thirsty company undertook two rapid-fire equity raisings. This equity degustation means shareholders have zero appetite to tip in more share capital.

Traditional bank lenders will be equally underwhelmed at stepping up to the plate. This explains why the bets are on McCann to drum up interest for raising $300 million via convertible notes, which are quasi-debt/equity.

And if I were a betting person, I would put Bruce Mathieson as the most likely investor to dive into this investment. Mathieson is already the largest shareholder in Star, and regardless of all the casino company’s missteps and financial trauma, he appears to retain faith that the company will recover.

Once these notes convert, Mathieson could significantly boost his stake in Star – possibly to a controlling position.

But to issue convertible notes, the lenders will need to give the company some space on the lending covenants – either loosen or extend them.

Part of McCann’s plan is to get help from at least the NSW government – a bit of tax breathing space.

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Star already received a bit of help last year from the NSW government, which delayed the imposition of additional taxes that had been on the drawing board. In return, Star had to ensure it continued to employ 3000 people at its Sydney casino.

McCann needs to manage all these stakeholder players and convince them that if he throws in his cards, they all lose.

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