Billionaire businessman Tilman Fertitta has pulled out of an $8.6 billion blank-check deal to take Fertitta Entertainment, his restaurant and casino company, public. The business, parent company of the Golden Nugget casinos brand, has reached a settlement with Fast Acquisition Corp., the special purpose acquisition company with which it was set to merge.
Fertitta Entertainment, which also owns the popular Landry’s restaurant group, has agreed to pay as much as $33 million to end the planned merger with the SPAC, reported Bloomberg over the weekend. Fast Acquisition Corp. was formed last year. The termination deal will avoid a court battle between both parties.
“At the end of the day we ultimately determined that the right decision for my company was to remain private at this time,” Fertitta said in a statement on Friday. “I look forward to continuing to grow our business both organically and in-organically.” The termination and settlement deal was made public on Thursday in documents filed with the Securities and Exchange Commission.
A dispute between Fertitta and Fast Acquisition was first made public earlier this month: Fertitta’s general counsel sent a letter on December 1, notifying the SPAC of intentions to call off the merger. The entertainment brand cited delays in the merger as the main reason for wanting to terminate the deal, while Fast Acquisition threatened legal action in response.
This settlement now brings the dispute to an end, meaning Fertitta’s brand will remain private for the foreseeable future. Meanwhile, Fast Acquisition, whose backers include Ruby Tuesday founder Sandy Beall, said it will continue to look for a combination with a new company. The settlement ensures the SPAC will remain sufficiently capitalized while it looks for a new deal.
The proposed merger between Fertitta Entertainment and Fast had been in development since February, but the deal fell through when Fertitta said it was choosing to terminate the agreement after both parties failed to close the deal by the termination date initially set.
Fast Acquisition Corp. harshly criticized this move, and accused the Houston-based company of “material breach,” while stating it would bring the matter to court. The SPAC argued Fertitta Entertainment failed to deliver financial statements in a timely fashion, meaning the Golden Nugget parent company was “unquestionably” responsible for the failure of the closing.
Fertitta, also the owner of the Houston Rockets, claimed both sides tried to fulfill their respective obligations, but regulatory approval didn’t come until November 24, making it impossible to close on time. Thus, Fertitta Entertainment said “it was in its best interest” to exercise its termination right under the merger agreement.
Both companies now deny breaking the merger contract, and explained a settlement presented the ideal solution as “litigation relating to the foregoing matters would be expensive, time-consuming, distracting and disruptive.”
Under the settlement’s terms, Fertitta Entertainment will pay the SPAC $6 million and loan an additional $1 million within the next week. Fertitta also agreed to pay an additional $26 million if the blank check company fails to merge with another company before it must liquidate next August or $10 million if FAST is able to successfully find another partner, reports Houston Chronicle.
Original article: https://www.yogonet.com/international/news/2021/12/13/60577-golden-nugget-parent-firm-to-remain-private-as-fertitta-pays–33m-to-terminate-spac-merger
