Fertitta to spin off Golden Nugget’s online gaming business into a $745M public company Howard Stutz, CDC Gaming Reports · June 29, 2020 at 4:15 pm Houston billionaire Tilman Fertitta said Monday he will spin-off his Golden Nugget Casinos’ online gaming business into a separate public company valued at $745 million. The business – to be called Golden Nugget Online Gaming – will be traded on the Nasdaq under the symbol GNOG and will own Golden Nugget’s current online gaming business in New Jersey and planned online gaming businesses in Pennsylvania and Michigan. The spin-off is taking place through Landcadia II, a special purpose acquisition company co-sponsored by Fertitta Entertainment, Inc. and Jefferies Financial Group Inc. The deal is expected to close by the fall. Fertitta’s Golden Nugget casino brand, which is part of his privately held Landry’s Inc., has five casinos in Las Vegas; Atlantic City; Lake Charles, Louisiana; Biloxi, Mississippi; and Laughlin, Nevada. Fertitta, who owns the NBA’s Houston Rockets and has a business empire includes more than 600 restaurants and casinos said his company has been largely sidelined because of the coronavirus pandemic. In interviews with Bloomberg News and CNBC over the past few months, Fertitta has hinted at various actions to save his businesses. Last week on CNBC, Fertitta called on American residents to wear face coverings in public, saying it is necessary to keep the U.S. economy open during the coronavirus pandemic. He said he noticed “a little pullback” in consumer activity across his business portfolio, which operates in 40 U.S. states, as some parts of the country see an uptick in Covid-19 cases. Golden Nugget’s online gaming launched in New Jersey in 2013 and considered the state’s largest Internet casino with more than $177 million in gaming revenue in 2019. The company expects to launch in Pennsylvania and Michigan by early 2021. Fertitta will be Golden Nugget Online Gaming’s chairman and CEO. Thomas Winter, who was brought in to develop Golden Nugget’s online gaming business, will continue to serve as the company’s president. “Golden Nugget is one of the most time-honored brands in the gaming business today,” Fertitta said in a statement. “When customers hear the name Golden Nugget, they know they are dealing with a trusted online gaming business. Thomas and his team have done a remarkable job, are the best in the industry, and with this transaction, will have access to growth capital to allow for the rapid expansion of the business.” Golden Nugget’s online gaming business includes such products as Live Dealer, Live Casino Floor gambling, and several exclusive slot machine games to mobile devices, tablets, and computers throughout New Jersey. Fertitta will hold a controlling economic interest and a controlling voting interest in the combined company. Landcadia II will assume $150 million of Golden Nugget Online Gaming’s debt and will pay down at closing an additional $150 million of its debt. “GNOG is one of the best-positioned companies to capitalize on this massive online gaming opportunity in the US,” said Rich Handler, co-chairman of Landcadia II and CEO of Jefferies LLC. “We at Jefferies couldn’t be more thrilled to partner with Tilman and bring this great opportunity to the public markets.” Macquarie Securities gaming analyst Chad Beynon noted Golden Nugget recently signed a multi-state, multi-product partnership agreement through 2024 with technology provider Scientific Games and the public offering has positive implications for the company. Beynon forecasted a $6.7 billion iGaming market in the U.S. by 2025. Golden Nugget’s spin-off the business was “indicative” of the “elevated interest” in online gaming. “U.S. iGaming and sports betting have been a hot market since the wave of legalization following the repeal of (the Professional and Amateur Sports Protection Act) and increased demand from stay-at-home orders,” Beynon said in a research note Monday. Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at firstname.lastname@example.org. Follow @howardstutz on Twitter.