Landcadia II amends purchase agreement for Golden Nugget Online Gaming

Landcadia Holdings II, has announced it has made amendments to its deal to acquire Golden Nugget’s online arm.

Landcadia Holdings II, the special purpose acquisition company (SPAC) that is working to acquire Golden Nugget Online Gaming (GNOG) announced that it has entered into an amendment to the purchase agreement to modify the voting requirements for stockholder approval.

This comes after Landcadia II was granted regulatory approval to acquire GNOG by the New Jersey Casino Control Commission last month. 

LandCadia II’s amendment

According to the company’s announcement, Landcadia II’s amendment will involve modifying the voting requirement for stockholder approval of the acquisition. 

The purpose of the amendment is to provide increased certainty that the business combination will receive stockholder approval at a special meeting of stockholders which will be held on 29 December.

In accordance with the amendment to the deal, the proposal to approve the business combination and certain related proposals will need to receive the affirmative vote of a majority of our outstanding shares of common stock that are voted at the special meeting instead of a majority of the outstanding shares of Class A common stock held by disinterested stockholders.

In addition to this, the amendment states the proposal to approve an amended and restated certificate of incorporation of the company must receive the affirmative vote of a majority of outstanding shares of common stock, instead of a majority of the outstanding shares of Class A common stock held by disinterested stockholders.

Landcadia II believes the amendment is in the best interests of its stockholders given the increase in the price of the company’s Class A common stock since the announcement of the business combination.

As of 18 December, roughly  99.8% of the Class A shares held by disinterested stockholders voted in favour of the business combination, and over 90% voted in favour of the other proposals

However, only approximately 40.5% of holders of Class A common stock have voted thus far, and the company believes that the low voter turnout is primarily the result of having a significant portion of its stockholder base made up of retail stockholders.

Landcadia hopes that the amendment will create more certainty that the business combination and other proposals will be approved as the shares of common stock held by Tilman J. Fertitta and his affiliates and Jefferies Financial Group and its affiliates have been voted in favour of each of the proposals.

The deal

Announced in June of this year, the combined GNOG and Landcadia II business was valued at $745m. Upon completion, it will become one of the first online gambling businesses to be listed on the Nasdaq.

Landcadia II is a blank check company that was established to help Golden Nugget secure its public listing and was created through a joint venture between Fertitta and the investment bank Jeffries LLC.

Once the deal is complete, Fertitta will act as the co-chair and CEO of the new business entity while Thomas Winter will remain GNOG president.

The transaction is expected to close in the third quarter of 2020 and values GNOG at approximately $745m or 6.1x its projected 2021 revenue which is $122m.

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