Court Gives Apollo the ‘go-ahead’ to Buy Canadian Casino Powerhouse
Great Canadian shareholders supported the motion for this deal last week. This was followed by the blessing of the Supreme Court of British Columbia.
Apollo Global Management first made it known to Great Canadian that it was interested in bidding between C$38 and C$41 per share in August. At the beginning of November, the private equity company submitted a formal offer of C$39 per share before the casino operator.
A good number of Great Canadian shareholders protested against Apollo's initial offer of C$3.3 billion, which is approximately $2.5 billion. It argued that this offer was not a true reflection of the value of the casino operator. This was especially valid when the fact that this casino operator was in control of gambling centers in the Greater Toronto region.
Changes to The Deal
Due to pressure from some of the most significant shareholders of Great Canada, Apollo Global Management made its deal more appealing by almost 16%. With this, the deal increased to C$45 for each share. The improved offer was a reflection of the casino firm’s share price before the pandemic became a force in February. With the coming of the pandemic, it had to close its properties in Canada for several months.
A meeting was held on the 23rd of December. In this meeting, about 79% of the Great Canadian shareholders were in support of the improved deal.
After getting the Supreme Court's approval and securing the shareholder vote, the deal needs regulatory approval before it gets closed.
Transaction Should be Closed in the Second Quarter
Apollo is on the right path in ensuring that the deal is closed in the second quarter of 2021. As soon as this is done, Great Canadian will no longer be a part of the Toronto Stock Exchange. According to Apollo, acquiring the casino operator will bring growth to its business because its financial flexibility will become long-term for a firm that is privately owned.
About Great Canadian
Great Canadian was established in 1982. It runs 26 casinos and hospitality facilities in Ontario, Nova Scotia, New Brunswick, and British Columbia. Due to the effect of coronavirus related restrictions, in Ontario, only two of the firm's properties are running. They are Casino Nova Scotia Sydney that runs at a capacity of 20%, and Casino New Brunswick which runs at a total of 25%.
Apollo has decided to put its funds into the Canadian casino operator after being involved in the global gambling sector for a long time. The private equity fund had been in the headlines regularly in the last couple of months as it announces investments of different sizes.
Apollo backed this gambling operator made it known that it put in €500 million into SAZKA Group, a Czech lottery operator. This was in November in a bid to support an attempt to get the UK National Lottery from Camelot.
Gamenet, a gambling operator backed by Apollo, made it known in December that it was working on owning IGT’s Italian B2C business. This was going to go down in a €950 million cash transaction.
Apollo also participated in the bid to acquire William Hill. However, the request came to an end rather rapidly because William Hill agreed to an offer put up by Caesars Entertainment, Inc. The online casino operator plans to put up William Hill’s operations out of the United States for sale. It wants to do this after the close of the takeover, which will occur later in the year. It turns out Apollo is interested in this deal.