Gateway Won’t Be Listing Publicly Just Yet
When Canadian gaming operator giant Gateway Casinos & Entertainment announced late last year that it was about to merge with a special purpose acquisition vehicle called Leisure Acquisition Corp. for the purpose of listing on the NY Stock Exchange, it seemed as if publicly listing was finally within the operator’s reach. Gateway would finally get to secure its New York Stock Exchange ticker, and in a way that would circumvent the need for a traditional IPO process being followed.
The proposed date for finalisation of the merger was at the time set for June 30th this year, only to be postponed yet again – this time round by Leisure Acquisition Corp. and its vote to extend the completion date to December 1, 2020.
No End To The Uncertainty
Not only will the CA$1.5 billion deal enable the Canadian operator to realise its dreams by listing on the New York Stock Exchange, but finalisation of the merger with Leisure Acquisition Corp. will ultimately also enable Leisure to expand its own commercial footprint. But the current economic crisis has caused a sidestep in everyone’s plans and what was supposed to have been a time of celebration, has now turned into a nerve-wrecking waiting game.
Even more uncertainty has been caused by the original provision that should no merger for the purpose of listing as a public entity have taken place by this coming July 15, then either of the two parties would be at liberty to cancel the agreement with the other, and form similar business relationships with outside parties.
But the postponement of the restructuring has also now put a hold on the appointment of new Gateway CEO Marc Falcone. The initial merger agreement between the operator and Leisure Corp. made conditional provision for the post-finalisation appointment of Falcone in the place of current CEO Tony Santo. This process too, is currently hanging in the balance.
An Unexpected Detour
That the liquidity and bottom-line value of both companies will have been affected by the current global crisis should come as no surprise. Gateway, for one, hasn’t been able to trade at land-based level for nearly four months now. The operator owns 27 casino venues scattered across British Columbia, Ontario, and Alberta, and to date, only two of these (Alberta) have been in a position to resume their business activities.
The result is that a time that was supposed to have seen a massive step of progress being taken by the operator, is now instead time spent trying to ensure the safe and compliant reopening of its casinos.