Full House Resorts is to buy Fitzgerald’s Casino in Tunica, Mississippi, from The Majestic Star Casino for US$62m.
Full House intends to fund the acquisition of the Fitz Casino with a combination of refinancing its existing credit facilities with a new credit facility with a capacity of approximately $125m and through an equity offering. The proceeds will also be used to fund certain required renovations at the property which are expected to be approximately $7m. Full House anticipates having financings and required regulatory approvals in place to accommodate closing the acquisition during the third quarter of 2014.
The Fitz Casino has 38,000 sq. ft. of gaming space with approximately 1,100 slot and video poker machines and 20 table games on a 53 acre site. The property includes a 506 room hotel with 68 suites, a fine dining restaurant, buffet, quick service restaurant, two casino bars and an 8,100 square foot multi-purpose event center. The property draws heavily from the Memphis, Tennessee market and benefits from approximately 14m people living within a 250 mile radius of the property. The Fitz Casino generated unaudited Adjusted EBITDA of approximately $10.1m for its fiscal year ending December 31, 2013.
Andre Hilliou, Chairman and Chief Executive Officer of Full House, said: “This property fits our acquisition strategy perfectly. This transaction is consistent with our long stated growth strategy and we believe it will create long-term shareholder value. The property has historically been well run and maintained under the current management team; however, we believe that we can leverage our knowledge and proven track record of managing properties catering to local customers in competitive environments to further improve the profitability of the Fitz Casino.”
Full House Resorts is a locals-oriented, regional casino company that owns, develops and manages gaming facilities. Full House owns the Rising Star Casino Resort in Rising Sun, Indiana, the Silver Slipper Casino in Hancock County, Mississippi, and Stockman’s Casino in Fallon, Nevada. Full House also operates the Grand Lodge Casino at Hyatt Regency Lake Tahoe Resort, Spa and Casino in Incline Village, Nevada under a lease agreement, and has a management agreement with the Pueblo of Pojoaque for the operations of the Buffalo Thunder Casino and Resort in Santa Fe, New Mexico along with the Pueblo’s Cities of Gold casino facilities.