Golden Nugget has petitioned New Jersey’s gaming regulators to approve its merger with Landcadia II, in order to launch its new online gaming venture in the state.
Special Meeting To Be Held Next Wednesday
Golden Nugget Online Gaming Inc. has asked the state of New Jersey to approve its merger agreement with special purpose acquisition company (SPAC) Landcadia Holdings II Inc. Pending approval, the entity will be able to separate the Golden Nugget Atlantic City online and land-based gaming operations.
The new online gaming business will be entirely detached from the casino and will go public, with stock sold on Nasdaq. The Casino Control Commission will weigh on the petition in a public hearing next Wednesday.
Landcadia II announced the merger on June 29 and stated during the same month that the new online gaming business will be the company’s second online casino entity traded on the public market in the US. The blank check company will change its name to Golden Nugget Online Gaming Inc, as well as its trading symbol from LCA to GNOG.
The New Jersey gaming regulators’ approval will finalize the transition.
Landcadia II CEO Tilman Fertitta will keep his position as chairman, CEO, and major shareholder of the new business. He also currently owns five Golden Nugget gaming facilities. Thomas Winter will become president of Golden Nugget Online Gaming, after leading the company’s digital operations since 2013.
Golden Nugget Expected To Grow Its Income
Landcadia had announced last June that it would transfer $321 million to Golden Nugget once the merger is completed, in order for the gaming operator to pay off its debt.
Golden Nugget recently reported a 92% year-on-year increase in its online net revenue and by 2% compared to the second quarter, with $25.9 million.
However, operating revenue fell by $300,000 in the third quarter from the second quarter.
The company reported above $177 million in online gaming revenue in 2019, while its Atlantic City casino only reported $22 million more than the online operations for the same year.
From January to October 2020, Golden Nugget generated more than $263 million from online and digital operations and reported a 72% jump in its gross revenues in the first nine months. The gaming operator also said more than $2 billion in bets were placed.
If Golden Nugget keeps reporting high results, Landcadia’s stock will soar once the deal closes. DraftKings merged with another SPAC in December 2019 and saw its shares doubles between the time of the announcement and the closing of the deal. Golden Nugget’s stock will probably record an even greater success, as the company is much more profitable than DraftKings at the moment.
Golden Nugget plans to launch other online gaming businesses across the US, including Michigan and Illinois.