Golden Nugget casinos to go public through SPAC merger

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Tilman Fertitta, owner of the Houston Rockets basketball team, announced plans Monday to take both his casino empire and his restaurant business public in a $6.6 billion deal with a blank-check company.

Fertitta has agreed to sell 40 percent of the Golden Nugget/Landry’s to Fast Acquisition Corp., a special-acquisition corp., or SPAC. Also known as blank-check companies, SPACs are empty shell companies that raise money to buy an existing business that then takes over it’s stock listing.

Fertitta will continue to run the businesses, which consists of five casinos and 600 restaurants, including Landry’s Seafood, McCormick & Schmick’s, the Del Frisco’s steakhouse chains, Morton’s Steakhouse and Bubba Gump Shrimp Co. The Rockets are not part of this transaction.

As The Post has reported, Fertitta has been in talks for more than a year to find an investor to buy a minority stake in his business partly so he can use proceeds to make more acquisitions. He recently announced plans to raise money through an initial public offering, but Wall Street was skeptical that a traditional offering would fly.

“After I compared the opportunities provided by a transaction with Fast, versus the traditional IPO route, it became abundantly clear that we could access the capital markets with more certainty and speed if we did a deal with Fast,” Feritta said in a written statement.

“We first began to explore going public in 2019, as we saw tremendous M & A deals hitting the market,” Fetitta added. “However, the pandemic set these efforts back. Fast provided us with the perfect merger vehicle to allow us to take control of an already existing public company. Fast’s capital along with the equity investment from institutional shareholders will strengthen our balance sheet and allow us to pursue our acquisition strategy.”

Fertitta will hold on to 60 percent of Golden Nugget/Landry’s after the sale to Fast and a $1.2 billion sale to institutional investors, Golden Nugget said. The deal doesn’t include all of Landry’s restaurants, Fertitta said, declining to give more details.

The agreement values Golden Nugget/Landry’s at about $6.6 billion.
Golden Nugget/Landry’s has $4 billion of debt, leaving $2.6 billion in equity, although some of that will be whittled down to pay off loans.

Almost half of the $4 billion in debt was borrowed so Fertitta in 2017 could buy the Houston Rockets.

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