Z Capital Partners, the alternative asset manager of private equity and credit funds, and its affiliate, Affinity Gaming, have announced a proposal to acquire Full House Resorts, the owner, developer and operator of gaming facilities throughout the US. The proposed transaction would be structured as a cash or stock transaction with an enterprise value of the company of $132.5m, which equates to $1.79 per share on a fully diluted basis.
However, having looked at the proposal, Full House has hinted that the buyers’ valuation is under priced. Its board responded immediately to the expression of interest saying that the offer would be considered, but warned that the price is significantly lower than recent and past trading of its shares.
James Zenni, chairman of Affinity’s board of directors and CEO of Z Capital Partners, announcing the approach, said: “Our proposal represents a unique and compelling opportunity to maximize value for stockholders and stakeholders in both companies. Combining Full House’s custom-designed, regional gaming properties with Affinity’s complementary portfolio will create a best-in-class platform for value creation in this consolidating market. With an experienced and dedicated management team, Affinity would bring significant operational capabilities and expertise that we believe would further propel the combined company’s growth and unlock unrealized potential for Full House stockholders.”
Zenni continued: “We look forward to a constructive dialogue with the Full House Resorts board of directors as they carry out their fiduciary duties on behalf of the company’s stockholders.”
Upon closing, the combined company would remain headquartered in Las Vegas, with a management team led by recently appointed Affinity CEO, Tony Rodio, a proven executive with more than three decades of experience in the gaming industry and a strong track record of transformative growth.