Investing.com-- Star Entertainment Group Ltd (ASX: SGR ) said on Monday that it has received a funding proposal from U.S.-based Bally’s Corp (NYSE: BALY ), which includes a capital injection of at least A$250 million for a majority stake in the company.

According to the unsolicited, non-binding proposal, Star would issue convertible notes that are subordinated to its existing senior lenders. These notes would be convertible into at least 50.1% of the company’s fully diluted ordinary shares.

"To be clear, we remain very open to discussing a larger transaction depending on our discussions with respect to Star’s liquidity and capital needs," Bally’s said in a statement.

Bally’s emphasized that, beyond capital support, it brings significant expertise in managing and turning around gaming assets worldwide. The company operates 19 casinos across 11 U.S. states and has expanded into the U.K. through recent acquisitions.

The proposal comes amid financial struggles for Star Entertainment, which has been seeking ways to improve liquidity and address regulatory and operational challenges.

The company’s available cash reserves plummeted from A$149 million in September 2024 to just A$79 million by December 2024, primarily due to escalating costs and regulatory fines.

Bally’s has stated its readiness to finalize a binding agreement by March 28, pending regulatory and shareholder approvals.

It said the company has already completed substantial due diligence based on publicly available information and its understanding of the Australian gaming market.

Star’s shares remain suspended from trading after failing to meet its last two deadlines for releasing financial results