News Summary
Standard General LP has completed a $4.6 billion deal to acquire the remaining shares of Bally’s Corp., sending Bally’s stock soaring by 24%. The deal includes a significant premium per share and aligns with Bally’s expansion strategy through its merger with Queen Casino & Entertainment Inc. Despite the acquisition, local operations in Rhode Island are expected to remain unaffected. This merger is set to strengthen Bally’s position in the gaming and entertainment industry, with a completion expected in the first half of 2025, pending regulatory approval.
Rhode Island – Hedge fund Standard General LP, which is already the majority shareholder of Bally’s Corp., has finalized a deal valued at $4.6 billion to purchase the remaining shares of the casino company. Bally’s announced that it has accepted a buyout offer of $18.25 per share from Standard General, marking a significant 71% premium over the company’s average stock price over the past 30 days. This merger signifies a major strategic shift within the company, as it combines Bally’s with Queen Casino & Entertainment Inc., a subsidiary of Standard General that operates four casinos in Illinois, Iowa, and Louisiana.
The transaction is anticipated to be completed in the first half of 2025 but is subject to regulatory approvals from several governing bodies. The local spokesperson for Bally’s stated that the merger will have “no impact” on operations within Rhode Island, where Bally’s operates its two state-run casinos, Bally’s Twin River Lincoln and Bally’s Tiverton Casino.
In the context of the merger, Mark Furcolo, the Rhode Island Lottery Director, noted that the deal requires thorough review and approval from state gambling regulators before moving forward. Furthermore, the Rhode Island state is poised to receive a payment of $303 million from Bally’s for the fiscal year starting July 1. This figure is complemented by forecasts of $315.1 million from slot play and additional revenues generated through table games, sports betting, and iGaming.
Financial Implications
Following the announcement of the merger, Bally’s stock experienced a surge of 24%, rising to $16.80. This uptick reflects investor confidence in the enhanced value expected from the merger. Bally’s, prior to this merger, employed approximately 10,600 people in various capacities and managed a portfolio of 15 casinos across 10 states.
Operational Background
This acquisition comes after Bally’s undertook significant strategic maneuvers earlier in the year, including selling the Tiverton casino real estate and its Biloxi Hard Rock casino to Gaming & Leisure Properties (GLPI). Under this agreement, Bally’s will lease back the casino and is committed to addressing at least $150 million of its debt. Additionally, the Rhode Island General Assembly has enacted legislation permitting Bally’s to negotiate amendments to its operating agreement without requiring further legislative approval. This provides greater flexibility in their local operations.
In terms of its long-term agreements, Bally’s maintains a 20-year operating agreement with the state of Rhode Island, allowing it to run legal gambling activities in partnership with International Game Technology (IGT). Recently, Bally’s has also expanded its services, launching online gambling in Rhode Island and receiving authorization to double its customer credit limit at state casinos.
Future Outlook
As the merger progresses, the combined entity is expected to operate 19 gaming and entertainment facilities nationwide, further amplifying Bally’s geographic and market diversity. Standard General’s chairman articulated confidence that this merger will create a larger, more robust portfolio with substantial growth opportunities. The deal has garnered support from entities such as Sinclair Broadcast Group and Gamesys founder Noel Hayden, who are expected to play roles in the upcoming rollover elections.
The merger, when finalized, aims to significantly enhance Bally’s operational scale and market reach, reflecting the growing trends and competitive landscape of the gaming and entertainment industry.
Deeper Dive: News & Info About This Topic
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