Bally’s and Gamesys agree terms on combination
Bally’s Corporation and online gaming operator Gamesys Group have agreed on definitive terms by which the pair will undertake a business combination.
News of the potential move first broke last month, with the proposed $2bn transaction to see the US casino operator absorb Gamesys in a deal worth 1,850 pence per share.
Both parties’ board of directors assert that the combination “ has a compelling strategic and ﬁnancial rationale, would create long-term value for both companies and would be consistent with the companies’ respective long-term growth strategies”.
The combined group would be headquartered in Providence Rhode Island, and its shares would retain their listing on the New York Stock Exchange. After completion, a request would be made to cancel trading in Gamesys shares and de-list from the London Stock Exchange.
It is added that Lee Fenton, Gamesys’ CEO, would occupy the same role in the combined group, with Robeson Reeves (Gamesys COO) and Ji m Ryan (a non-executive director of Gamesys) to also join the US group’s board. George Papanier, Bally’s CEO, wo uld remain a member of the board and a senior executive running the retail casino business.
“We believe that this combination will mark a transformational step in our journey to become a leading integrated, omni-channel gaming company with a B2B2C business,” explained Soo Kim, chairman of Bally’s Corporation.
“We think that Gamesys’ proven technology platform alongside its highly respected and experienced management team, combined with the US market access that Bally’s provides, should allow the combined group to capitalise on the signiﬁcant growth opportunities in the US sports betting and online markets.
“We are truly excited about the opportunities that this combination would oﬀer and the enhanced and comprehensive experience and product oﬀering that it would enable us to oﬀer our customers.”
Consistent with UK regulatory requirements, Bally’s arranged interim financing for the transaction from Deutsche Bank Aktiengesellschaft, London Branch, Goldman Sachs Bank USA and Barclays Bank.
The company says that it intends to seek to refinance the bridge facility and Gamesys’ debt through one or more capital market transactions, which could include public or private offerings of Bally’s shares or other securities and a company-wide bank credit facility.
Neil Goulden, chairman of Gamesys, commented: “The combination would give unique optionality to Gamesys shareholders. The recommended cash offer, including the Gamesys FY20 dividend, provides a 41.2 per cent premium to the Gamesys share price at the time of the original proposal from Bally’s and is at a significant premium to the all-time high Gamesys share price prior to the 2.4 announcement.
“However, should Gamesys shareholders wish to invest in a business with a strong foothold in the high-growth US gambling market, combined with established markets in the UK and Japan, they can elect for part or all of their holding to be converted into Bally’s shares.”