Houston hospitality mogul Tilman Fertitta plans to take his empire public through a $1.4 billion merger with a special purpose acquisition company (SPAC), according to a Feb. 1 announcement.
Fertitta Entertainment, which owns Golden Nugget/Landry’s, is set to merge with the SPAC, FAST Acquisition, in a deal that values the combined company at $6.6 billion.
Latham & Watkins is representing Fertitta Entertainment in the transaction with an M&A deal team led by Houston partners Ryan Maierson and Nick Dhesi, with Houston associates Thomas Verity, Bryan Ryan, Denny Lee, Lexi Santa Ana, Danielle Kinchen, Ben Marek and Ricardo Alvarado.
Advice was also provided on tax matters by New York partners Lisa Watts and David Raab and Los Angeles counsel William Kessler, with Houston associate Jared Grimley.
Winston & Strawn and White & Case are advising FAST. The Winston team is led from New York and Chicago, but it includes Dallas partner Chip Gage.
A White & Case spokesperson told the Texas Lawbook that all the firm’s lawyers involved in the deal are based in New York.
Boston-based law firm Goodwin Procter and Skadden, Arps, Slate, Meagher & Flom are representing Jefferies, which is lead placement agent on the $1.2 billion private investment in public equity to fund the deal. Jefferies is also financial and capital markets advisor to Fertitta Entertainment.
In addition to the PIPE financing, FAST will fund the acquisition with $200 million in cash held in trust.
The combined company plans to use the proceeds from the deal to accelerate growth, fund general corporate purposes and reduce existing debt.
The merger will include Fertitta Enertainment’s holdings in Golden Nugget and Landry’s, umbrella brands that operate a number of restaurant chains, hotels and casinos. According to the announcement, Fertitta Entertainment operates more than 500 outlets including more than 400 dining establishments throughoutt the world, including Bubba Gump Shrimp, Rainforest Cafe and Morton’s The Steakhouse.
The deal excludes assets the billionaire owns privately, including the Houston Rockets NBA franchise.
The deal marks the third SPAC deal involving Fertitta in a matter of weeks. Last week, Fertitta’s Landcadia III SPAC announced it would merge with Cincinnatti-based hardware and home improvement supplies distributor Hillman in an $875 million deal.
The Hillman deal was announced about 20 days after another Fertitta-controlled SPAC, Landcadia II, closed its acquisition of Fertitta’s own online casino Golden Nugget Online Gaming for $745 million.
In a statement, Fertitta said the company was exploring going public as early as 2019, but Covid-19 delayed those plans.
“After taking the Company private in 2010, we accomplished a lot,” he said in a statement. “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 … 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.”