Golden Nugget Online Gaming is set to go public on the Nasdaq exchange.
Golden Nugget Online Gaming, the online arm of the Golden Nugget casino chain, is set to go public on the Nasdaq exchange with an estimated valuation of $745m.
The transaction
The casino chain, which is owned and operated by Landry’s Incorporated and owned by Tilman Fertitta, will become the second online casino operator to be purely publicly traded on the Nasdaq.
Similar to the transaction that took DraftKings public earlier this year, a publicly listed special purpose acquisition company (SPAC) will acquire the online casino division from Landry’s.
Landcadia II will act as the SPAC and upon closing it will change its names to Golden Nugget Online Gaming (GNOG) Inc, with the trading symbol $GNOG.
The transaction is expected to close in the third quarter of 2020 and values GNOG at approximately $745m or 6.1x its projected 2021 revenue which is $122m.
The owner will stay the same
Landcadia II is a blank check company that was established to help Golden Nugget secure its public listing and was created through a joint venture between Fertitta and the investment bank Jeffries LLC.
Tilman Fertitta will remain in his role as GNOG’s chairman and CEO while Thomas Winter, who has overseen Golden Nugget’s online gaming operations since launch, will become the company’s president.
Fertitta said: “Thomas and his team have done a remarkable job, are the best in the industry, and with this transaction, will have access to growth capital to allow for the rapid expansion of the business.”
Fertitta will hold a controlling economic interest and a controlling voting interest in the new company.
Rich Handler, chief executive of Jeffries and co-chair of Lancadaia, said: “GNOG is one of the best positioned companies to capitalize on this massive online gaming opportunity in the US. We at Jefferies couldn’t be more thrilled to partner with Tilman and bring this great opportunity to the public markets.”
A well-timed deal
With the success of DraftKings’ listing and GAN’s US IPO, it looks like other online gambling companies have seen the potential of the public markets.
The transaction will allow Fertitta to raise funds and offset the loss of the country-wide casino closures due to the coronavirus pandemic.
With the massive valuation being applied to online gambling companies in the US, it is likely that other businesses will be looking to go public this year.
