Tilman Fertitta, a billionaire businessman, announced that his online gaming company, Golden Nugget, will be making its debut as a standalone and publicly traded entity under the ticker GNOG. This was announced after Landcadia Holdings II investors gave their consent to a merger between the two companies. Landcadia previously failed to gather enough votes for the merger at a virtual meeting that took place earlier in December 2020.
Landcadia, a special purpose acquisition company (SPAC), is controlled by Fertitta and Jefferies investment bank. The previous virtual conference that took place earlier in December and yielded less than fruitful results was adjourned by Fertitta. Landcadia Holdings II then called a special meeting for shareholders. The majority of the shareholders consented to the merger and thus, GNOG announced its Nasdaq debut.
The SPAC, Landcadia Holdings, has an investor base that’s around 70% retail, and the retail group does not typically pay much attention to corporate voting, the corporation amended its purchasing agreement with Golden Nugget Online. The SPAC then allowed a simple majority of attendees at the meeting to vote in favour of the combination to move the process forward, instead of more than half of the shareholder count. The strategy proved to be successful. The virtual meeting that gave GNOG the go-ahead lasted under ten minutes, with attendees voting largely in favour of the merger.
Lancadia and Golden Nugget Online Gaming announced that they would be attempting to merge in late June 2020. This merger presented a golden opportunity for the iGaming operator to be publicly traded. At that time, it was expected the transaction would be completed by the end of the third quarter. However, unforeseen circumstances led to unexpected delays for the New Jersey Casino Control Commission (CCC) to give its opinion on the matter. The CCC’s approval was necessary as New Jersey is the home of Golden Nugget Online Gaming’s biggest market. The green light from the CCC was only received in November last year.
The merger has valued GNOG at $745 million. Landcadia has assumed $150 million of GNOG’s debts and expects that once the iGaming firm goes public, it will have a market capitalization of nearly $700 million and $8 million cash on its balance sheet.
Special purpose Acquisition Companies, or SPAC, was one of the leading market trends of 2020 for many industries, iGaming and gambling included. The advantages of SPAC are simple, with the GNOG merger a prime example of the benefits. Despite the hurdles that were created by the global pandemic and a second shareholder meeting being required to complete the transaction, the time from the announcement of the merger to its completion was only six months. Conversely, the traditional public offering process of IPO can take a year or more to complete. This is why so many companies and organizations opted to transact with bank-check firms. It has significantly improved turnaround times for companies who are looking to go public as soon as possible.