Golden Nugget Online Gaming (GNOG) has obtained crucial approval for its merger with special-purpose acquisition company Landcadia Holdings II Inc. from New Jersey gaming regulators.
GNOG is the iGaming and sports betting division of the Golden Nugget casino empire, owned by Tilman Fertitta. The operator announced plans last summer to merge with blank checking company Landcadia and go public on Wall Street.
When the combination is final, GNOG will join DraftKings as the only other publicly traded purely online gambling company in the US DraftKings completed a similar alliance with a SPAC in April.
New Jersey Regulatory Approval and Licensing
The New Jersey Casino Control Commission on Wednesday issued a casino license to GNOG as an online gaming subsidiary of Golden Nugget Atlantic City. The agency also conditionally approved the association of the company with Landcadia.
Once the merger closes, Landcadia, which was formed by Golden Nugget owner Mr. Fertitta, will change its name to Golden Nugget Online Gaming Inc. and its ticker symbol NASDAQ will change from LCA to GNOG.
The transaction was originally expected to close in the third quarter of the year. However, pending regulatory approvals have delayed their completion. GNOG and Landcadia are still waiting for the federal green light to combine.
New Jersey regulators express concern over the deal
Dylan Thompson, who represented the New Jersey Games Enforcement Division during a hearing Wednesday on the merger, expressed concern that the transaction could have Negative effects on Golden Nugget’s land-based casino in Atlantic City, if online gambling becomes a focus of the company’s operations in the state.
Mr. Thomspon said the union could deprive the casino “of much needed cash flow from Internet games permanently.”
The Chairman of the Casino Control Commission, James Plousis, said he understood those concerns and supported several proposed conditions with the aim of ensure that the physical casino suffered no losses nor became a victim of negligence following the combination of GNOG with Landcadia and due to Golden Nugget’s continued focus on online gambling.
Still, Mr. Plousis said he was satisfied with Golden Nugget’s assurances that it is committed to its Atlantic City casino and that Mr. Fertitta “protect Golden Nugget’s brand of excellence and elegance and it will do so by supporting, maintaining and ultimately growing the Atlantic City casino hotel facilities. ”
Richard Liem, vice president and treasurer of Golden Nugget Atlantic City, told regulators that the merger will ensure that they have access to much-needed capital that they “need”. have adequate access to capital to be able to grow and compete effectively ”in the young but fast growing online gaming industry.
Golden Nugget’s online operation has long been a market leader in New Jersey, but it has also secured access to Pennsylvania, Michigan and, more recently, to Illinois and West Virginia through strategic partnerships.