Gaming and hospitality company Golden Entertainment announced Monday that it entered into definitive agreements to sell its slot machine business in Nevada and Montana to J&J Ventures Gaming for cash consideration of $322.5 million, plus $39 million of estimated purchased cash at closing.
J&J Ventures Gaming, a privately held Illinois-based company, will acquire Golden Entertainment’s Distributed Gaming Operations in Nevada for $213.5 million plus an estimated $34 million of purchased cash and Golden’s Distributed Gaming Operations in Montana for $109 million, plus an estimated $5 million of purchased cash.
Golden operates roughly 10,500 slot machines at more than 1,000 non-casino locations in Nevada and Montana. In addition to its slot machines business, Golden owns nine casinos in Nevada, including The STRAT Hotel, Casino & SkyPod.
Additionally, Golden, which is Nevada’s largest slot machine route operator, will enter into a five-year agreement with J&J Gaming to support the gaming operations of its branded tavern locations in Nevada “at financial terms consistent with the company’s past practice.” Golden owns 64 Nevada taverns, operated under the PT’s, Sierra Gold and other brands.
Blake Sartini, Chairman and Chief Executive Officer of Golden, commented: “Our leading Distributed Gaming Operations in Nevada and Montana were built over the last 20 years through the hard work and dedication of our team members who provide exceptional service and support to our valued route partners. We believe this transaction will provide further success for our route partners through sharing of best practices and new technology.”
“We anticipate our Distributed Gaming team members will continue to serve our route partners with the same dedication under J&J Gaming’s ownership,” he added. “Our confidence in J&J Gaming’s future success is highlighted by our new long-term agreement with J&J Gaming to service Golden’s wholly-owned tavern portfolio.”
For Golden, these transactions will allow the firm to focus its management team and capital on its portfolio of wholly owned casinos and taverns in Nevada and create additional value for our shareholders, said Sartini.
The transactions are expected to close prior to year-end, subject to customary regulatory approvals and closing conditions. Latham & Watkins LLP is acting as legal counsel to Golden in connection with the deals.
Established almost 100 years ago, J&J Gaming is a privately held business and a distributed gaming operator in Illinois, with related operations in several other states.
The aggregate cash consideration plus purchased cash represents a multiple of approximately 9.0x of the Adjusted EBITDA for Golden’s Distributed Gaming segment for the year ended December 31, 2022 of $44 million, net of $3.8 million of corporate costs allocated to the Company’s Distributed Gaming segment.
Original article: https://www.yogonet.com/international/news/2023/03/07/66340-golden-entertainment-to-sell-slot-machine-business-in-nevada-montana-for-3225-million
