HOUSTON – (Realty News Report) – Houston hospitality and gaming magnate Tilman Fertitta has reached an agreement to bring his Golden Nugget and Landry’s empire back to the public markets.
Fertitta Entertainment, the parent company of Golden Nugget and Landry’s, will merge with FAST Acquisition Corp., a special purpose acquisition company (SPAC). The merger will result in Fertitta Entertainment becoming a publicly listed company.
“I look forward to returning my company to the public marketplace. After taking the company private in 2010, we accomplished a lot. However, in today’s opportunistic world, I determined that in order to maximize the opportunities in the gaming, entertainment and hospitality sectors, it was preferable to take my company public,” Fertitta said.
The deal arrives as major casino operators, including Las Vegas Sands Corp. and Caesars Entertainment, intensify lobbying efforts in Austin to support legalization of casino gambling in Texas.
Fertitta, who also owns the NBA’s Houston Rockets, heads an entertainment organization that includes five Golden Nugget casinos, roughly 600 restaurants, and a portfolio of hotels and entertainment venues such as the Kemah Boardwalk and the Pleasure Pier in Galveston.
The COVID-19 pandemic severely impacted the business. About a year prior, Fertitta laid off 45,000 employees when the hospitality company was experiencing a cash burn of approximately $2 million per day.
As chairman and CEO with a roughly 60 percent ownership stake, Fertitta will lead the company created by the merger with FAST, which is led by Doug Jacob and Sandy Beall.
“We first began to explore going public in 2019, as we saw tremendous M&A deals hitting the market. However, the pandemic set these efforts back. FAST provided us with the perfect merger vehicle to allow us to take control of an already existing public company. FAST’s capital along with the equity investment from institutional shareholders will strengthen our balance sheet and allow us to pursue our acquisition strategy,” Fertitta said.
He added, “After I compared the opportunities provided by a transaction with FAST versus the traditional IPO route, it became abundantly clear that we could access the capital markets with more certainty and speed if we did a deal with FAST. Working with Doug and Sandy has been a pleasure, and I truly appreciate their time and contribution to this process. At the end of the day, the decision to do a deal with FAST was a no-brainer.”
The transaction implies an enterprise valuation for Golden Nugget and Landry’s of $6.6 billion.
“The hospitality industry is experiencing the greatest disruption of our lifetimes and Tilman and his team have remained the premier gaming and restaurant operators in the country,” said Doug Jacob. “We believe this diverse portfolio—made up of full-service dining and entertainment concepts combined with pent-up consumer demand—will find continued success as a public company.”
Eugene Remm, a restaurant operator who serves as Chief Brand Officer for FAST and is a partner with Fertitta in the Catch Restaurant Group, is expected to join the company’s board.
Fertitta’s restaurant holdings include Del Frisco’s Steakhouses, Willie G’s, McCormick & Schmick’s and casual dining brands such as Landry’s Seafood, Bubba Gump Shrimp Co., Rainforest Cafe, Mitchell’s Fish Market and Saltgrass Steak House.
The Golden Nugget casino properties are located in downtown Las Vegas; Lake Charles, Louisiana; Atlantic City; Biloxi; and Laughlin, Nevada.
Fertitta serves as chairman of the University of Houston Board of Regents and is an alumnus of UH’s Conrad Hilton College of Hotel and Restaurant Management.
Feb. 1, 2021 Realty News Report Copyright 2021
File: Tilman Fertitta Going Public 2021
Caption: Fertitta’s Post Oak hotel and restaurant complex on Loop 610. Rendering: Gensler