Star Entertainment Group Inc. (OTCPK:SETY) chief executive Robbie Cooke is considering a sale and lease-back of the company's Sydney casino as it battles to plug an earnings black hole, regulatory screws tighten and it faces mammoth potential tax increases. Mr. Cooke confirmed the first of about 500 retrenched workers would leave the gambling group on Thursday as part of a plan to slash $100 million in costs. Mr. Cooke also said it was in the process of receiving final bids for the Sheraton Grand Mirage Resort on the Gold Coast, which Star bought for $140 million.

The hotel is one of a number of properties the loss-making casino group has for sale in a bid to refinance debt and improve its liquidity position to increase its covenant headroom. Star has engaged investment bank Barrenjoey to complete a strategic review of the group. Mr. Cooke said it was looking at all options, including a sale and lease-back of its Sydney casino.