SYDNEY, AUSTRALIA: Ardent Leisure Group and RedBird Capital Partners have entered into a binding agreement with Dave & Buster’s for the sale of Main Event Entertainment Inc. for cash consideration of $835 million, a bourse filing said.
Ardent Leisure will use the proceeds to repay its outstanding debt facility to the Queensland Treasury Corporation and the deferred settlement payable to the ATO, pay Transaction costs, fund the continued growth and investment in the Theme Parks business.
If the transaction completes, Ardent Leisure will receive approximately $487m in cash for its 72.6% stake after repayment of debt in Main Event, payments to Main Event management under the existing Main Event Long Term Incentive Plan and in respect of shares owned by management, transaction costs and other transaction adjustments, but before the Purchase Price Adjustments.
This reflects Ardent Leisure’s share of the net proceeds of the Transaction having regard to its equity interest in Main Event and an agreement with RedBird in relation to the sharing of proceeds in respect of the portion of Ardent Leisure’s holdings in Main Event over which RedBird has an unexercised call option.
The Transaction follows a strategic review undertaken by Ardent Leisure and RedBird in relation to the future ownership of Main Event. The strategic review resulted in multiple offers being received and the Ardent Leisure Board considers the Transaction to be in the best interests of Ardent Leisure shareholders.
Following the sale of its stake in the Main Event business, Ardent Leisure will become solely focused on its Theme Parks business, have no debt and will have a strong cash position to support the ongoing recovery of the business, fund continued investment in new major rides/attractions, pursue opportunities for unlocking value in the parks’ surplus land and accelerate growth in this business.
Comments from Dr. Gary Weiss, Ardent Leisure Chairman said, “The Transaction reflects the significant value creation that has been achieved by Ardent Leisure and the Main Event management team, particularly over the past four years following the overhaul of the Ardent Board in September 2017 and the appointment of Chris Morris as Chief Executive Officer of Main Event in March 2018.
During this period, Main Event has expanded its centre footprint by over 30% and more than doubled EBITDA. Following the investment by RedBird Capital Partners in June 2020, Main Event was able to successfully navigate the challenging period of the COVID 19 pandemic and reestablish operations effectively, generating record revenues over the last twelve months.
Having regard to the valuation reflected by the Transaction and its terms and conditions, the Board believes that this Transaction with Dave & Buster’s is in the best interests of Ardent Leisure shareholders.
Furthermore, if the Transaction completes, Ardent Leisure shareholders will receive a significant distribution of cash and retain continued ownership in a leading theme parks operator with a strong balance sheet and highly experienced management team that is poised to benefit from the significant investments made in the business and the reopening of Australia’s economy and its international borders.”
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