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Online Casino Golden Nugget To Go Public Through Landcadia Acquisition

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LANDCADIA HOLDI/SH CL A (NASDAQ: LCA) announced Monday that it is acquiring Golden Nugget Online Gaming, Inc. in a move to take Golden Nuggett’s online gaming business public.

What Happened: Lancadia II is acquiring Golden Nugget’s online business with the intention of changing its name to Golden Nugget Online Gaming and listing on the Nasdaq exchange under the ticker "GNOG."

Why It's Important: Golden Nugget Hotels & Casinos owns five hotels in casinos in Atlantic City, Las Vegas, Biloxi, Lake Charles and Laughlin. The company Golden Nugget is owned by Tilman Fertitta and privately held Fertitta Entertainment.

Lancadia II is a publicly traded special purpose acquisition company co-sponsored by Fertitta Entertainment and Jefferies Financial Group. Tilman Fertitta will remain chairman and CEO of GNOC.

When GNOG goes public, it will offer investors a rare pure play on online gambling.

"GNOG is one of the best positioned companies to capitalize on this massive online gaming opportunity in the U.S.," said Rich Handler, co-chairman of Landcadia II and CEO of Jefferies.

The Golden Nugget has already established a position as an online gaming market leader in New Jersey and plans to expand into Pennsylvania and Michigan in early 2021.

GNOC launched in New Jersey in 2013 and has been profitable since 2016. The company reported more than $11 million in net income in 2019.

The deal values the new company at a pro forma enterprise value of about $745 million. The new company is expected to generate $122 million in 2021 revenue.

GNOC expects the transaction to close in the third quarter.

Benzinga’s Take: There are plenty of casino stocks out there, but relatively few online gaming pure-plays. Online gaming has received a lot of attention in 2020 after brick-and-mortar casinos around the world were forced to close down due to the COVID-19 outbreak.

Do you agree with this take? Email feedback@benzinga.com with your thoughts.

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