Everyone has been waiting for Apollo Global Management to ups its bid for Great Canadian Gaming Corp. Now it has happened!
The new offer is up by 15%, sure to please the shareholders who own 50% of the company who had voiced strong opposition.
BloombergSen, CI Global Asset Management and Burgundy Asset Management Ltd., no longer want to block the deal.
The equity value of the new proposal is slightly more than C$2.5 billion ($2 billion) based on a total of 56 million shares outstanding. Great Canadian operates twenty-six gaming, entertainment and hospitality venues across Canada.
The private equity firm clearly wants the casino operator and is willing to get it for C$45 a share. Of note, this is where the share price landed last February. Apollo’s first offer of C$39 was said to be too low and undervalued the company.
BloombergSen co-founder, Sanjay Sen, nixed the offer’s “rock bottom” price, saying Great Canadian didn’t need a sale because it was still making money. Of course, at the time of Apollo’s first offer, revenues had taken a considerable hit.
Now the tables have turned. According to Peter Meredith, the Richmond, British Columbia-based casino company’s chairman,
“The increased purchase price of C$45 per share unlocks greater value for shareholders; the company and board appreciate the support of some of Great Canadian’s largest institutional shareholders for this transaction.”
The new bid is considered a real breakthrough and a significant reversal in Apollo’s on-going buyout attempt. Predictions were calling for a defeat.