Canada’s Gateway Casinos will go public. The casino operator, Gateway Casinos & Entertainment Ltd, announced Friday that it has inked a merger deal with a publicly-traded shell company. The entire deal has been finalized for $1.12 billion.
The merger is facilitated by Leisure Acquisition Corp which is to merge with Gateway. The new enterprise born out of the merger will be a new subsidiary of Gateway’s holding company GTWY Holdings Ltd.
The merger route to go public comes after the casino operator dropped its IPO plans. The operator had earlier filed paperwork for a U.S. initial public offering in November 2018.
Gateway Casinos operates over two dozen properties in Canada’s British Colombia, Ontario and Edmonton. Once the merger is finalized, Gateway’s shares will trade on the New York Stock Exchange under the ticker “GTWY.”
The deal is facilitated through a special purpose acquisition vehicle SPAC. It uses proceeds from an IPO, together with borrowed funds, to acquire companies that are usually privately held.
While Morgan Stanley acted as an M&A advisor to Gateway, Credit Suisse advised Leisure.
Commenting on the deal, Gabriel de Alba, Managing Director and Partner of Catalyst and Executive Chairman of Gateway, said: “With its strong corporate and property operating teams, diversified growth initiatives, and industry-leading operating model, Gateway has built tremendous momentum and established a solid foundation for ongoing growth.
We are proud of the team and their many accomplishments over the last six years which include doubling our locations and adjusted EBITDA, increasing our slot machines by nearly three-times, increasing our table games by over two-times and adding 56 new F&B outlets across British Columbia and Ontario.
The disciplined execution of our near- and long-term strategies have created significant value and returns over the years for all of the Company’s shareholders. We are thankful to Tony for his leadership of Gateway and his key role going forward.”
Leisure’s Executive Chairman A. Lorne Weil and Chief Executive Officer Daniel B. Silvers commented, “Early in our lifecycle, we identified Gateway as an attractive opportunity to leverage our team’s deep experience and skills in the leisure and gaming sector. We are excited to partner with the Gateway team, led by Marc, to accelerate Gateway’s growth through the many high-return initiatives already in place as well as by pursuing potential future accretive transactions across North America.