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Casino Owner Splits Off Online Operations And Takes Them Public In New Company

Timan Fertitta's Golden Nugget Online Gaming Is Being Acquired And Taken Public At A $745 Million Valuation

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A casino owner is separating his online gambling venture into a separate company and taking it public.

Tilman Fertitta, the Houston-based billionaire that owns the Golden Nugget Casino brand, announced Monday that he has entered into an agreement with Landcadia II, a special purpose acquisition company that is sponsored by Fertitta’s entertainment company and publicly traded on the NASDAQ for his online operations.

According to the press release, when the deal is completed, Landcadia II will change its name to Golden Nugget Online Gaming Inc. It will trade on the NASDAQ under the ticker symbol “GNOG.” The deal is expected to be finalized in the third quarter of this year and will value the company at $745 million.

“GNOG is one of the best positioned companies to capitalize on this massive online gaming opportunity in the US,” Co-Chairman of Lancadia II and CEO of Jeffries LLC, Rich Handler, said in a statement. “We at Jeffries couldn’t be more thrilled to partner with Tilman and bring this great opportunity to public markets.”

With the COVID-19 pandemic crippling the brick-and-mortar casino industry, areas where online gaming is legal saw increased demand. America’s entire casino industry shut down in mid-March and New Jersey online casinos set records.

New Jersey online casino operators set a record for online gaming revenue in May. Garden State online poker rooms saw all-time revenue highs in April.

Golden Nugget’s online operations grabbed the biggest piece of the New Jersey online market share during the surge. In May, the company generated $29.1 million in revenue, which is about a third of the $85.9 million won from New Jersey gamblers by online casinos.

Golden Nugget has been operating online since 2013, became profitable in 2016, was the first online gaming company to launch Live Dealer games in the U.S. and also has obtained regulatory approval from Pennsylvania and Michigan, two other regulated online gaming markets.

“Golden Nugget is one of the most time-honored brands in the gaming business today,” said Fertitta in a statement. “When customers hear the name Golden Nugget, they know they are dealing with a trusted online gaming business.”

The $745 million valuation that was agreed upon was calculated by taking 6.1 times GNOG’s estimated revenue of $122 million. Fertitta will serve as Chairman and CEO of the company and will hold a controlling economic and voting interest in the new, combined company.