Bally’s to Consider Takeover Offer from Standard General, One of its Shareholders
Bally’s Corp. may be trading hands but if it happens, its new owners should seem familiar.
The Rhode Island-based, publicly traded gaming company with operations in 13 states received an offer Tuesday to be purchased by one of its current major shareholders, Standard General. It’s a New York-based investment firm that, on its websites says, “manages event-driven opportunity funds.”
Of note is Standard General already owns about 20% of Bally’s shares, and that Soohyung (Soo) Kim, managing partner and chief investment officer of Standard General, is also chairman of the board of directors of Bally’s Corp.
The early indication is Bally’s would become privately owned.
The offer from Standard General is for $38 per share, which is a premium of 30% to the company’s closing price as of Jan. 24. In an email to the Bally’s board of directors, Kim described the offer as presenting “compelling value to Bally’s stockholders.”
Bally’s Stock Rises
Bally’s stock soared on the news Tuesday and was up more than 20% at about $36 in early afternoon trading.
The Standard General offer insists the Bally’s board of directors appoints a special committee of independent directors to consider Standard General’s proposal and make a recommendation to the Bally’s board.
Standard General said it would not go ahead with the deal unless it is approved by such a special committee. Standard General also said in its email to Bally’s that the transaction will be subject to a “non-waivable condition requiring the approval of holders of a majority of the shares of the Company not owned by Standard General or its affiliates.”
In making its proposal, Standard General not only referenced what it felt was an attractive price for shareholders but opined that such an offer also provides stockholders “certainty of value for their shares, especially when viewed against the operational risks inherent in the Company's business and the market risks inherent in remaining a public company.”
Like much of the gaming sector, Bally’s has seen a drop in share price lately. In March, the stock was trading in the low $70s as investor enthusiasm for online gaming surged, but Bally’s shares were about $27 late last week.
’A Detailed Understanding of Bally’s’
Underscoring Standard General’s familiarity with Bally’s was this inclusion in its offer: “As a result of our long-term involvement with the company and its predecessor, we have a detailed understanding of Bally’s, its business and assets, which will enable us to move quickly to finalize a transaction” and also that no due diligence would be required.
Bally’s was formerly known as Twin River Worldwide Holdings and Kim was also board chairman of Twin River. Among Bally’s current properties are Bally’s Atlantic City Casino Resort in New Jersey and the Tropicana Hotel & Casino in Las Vegas, plus others. It also has online sports betting operations in eight states.
Bally Bet Preparing for NY
Bally Bet is one of three online sportsbooks that has yet to launch in the New York sports betting market. It received approval in November. Four NY sportsbooks launched on Jan. 8 and six are now live, the latest being PointsBet, which took its first bet Monday night.
New York does not offer real money online casinos.
A deal between Bally’s and Standard General would be subject to regulatory approvals, including applicable gaming regulations, antitrust laws and other customary conditions.