Golden Nugget Online Gaming (GNOG) is all set to provide online casino offerings in New Jersey after formal approval by the state authority. This came after the New Jersey Casino Control Commission (CCC) approved the license for Las Vegas-based hotel and casino company owned by Tilman Fertitta on Wednesday.
The move will now allow the online casino operator to merge with Landacia Holdings II Inc., a blank-check company, and become a publicly-traded entity. However, federal authorities are yet to approve the deal. With this, the GNOG is a step closer to being listed on Wall Street.
How Did We Reach Here?
In June, a special purpose acquisition company Landcadia Holdings II, co-owned by Fertitta and investment bank Jefferies, revealed plans to acquire Golden Nugget Online Gaming Inc. and to rebrand its name after it. The development enabled the iGaming company to embark on a route to list on a major US exchange, besides a monetization outlet.
Back then, the intention was to list the internet casino operator on the NASDAQ Stock Exchange under “GNOG” during the third quarter, But the plan did not materialize.
Will GNOG Split from GNAC Hurt Atlantic City Casinos?
In a hearing that dragged on more than two hours on Wednesday, Golden Nugget Atlantic City’s vice president and the senior vice president of online gaming responded to the questions from the commissioners. An NJDGE official voiced a major concern that GNOG separating from GNAC would hurt the Atlantic City land-based casino. He recommended measures to make sure GNOG couldn’t just leave the brick-and-mortar business in the lurch, conditions with which the commission agreed.
Dylan Thompson, a representative of the state Division of Gaming Enforcement, was too concerned about the realistic negative impacts to Golden Nugget’s brick and mortar casino operations if the online component became a focal point. Thompson said the transaction would strip GNAC of the much-needed cash flow from online gaming on a permanent basis.
Richard Liem, GNAC’s vice president, argued that the primary benefit of taking a digital gaming company public was access to capital. As a smaller retail casino operator, Golden Nugget’s vigorous online performance and brand can be used to make it better, compete with more formidable players in certain markets.
What Will Happen Now?
The official date for the rebranding of Landcadia to Golden Nugget Online or its launch date was not revealed following the CCC decision. Though the Federal Trade Commission (FTC) is yet to sign the merger, the agency is not known to reject SPAC deals.
The focal point of the acquisition by Landcadia is to take GNOG public and attract investors to buy an entity before taking it public. Fertitta will have almost 80% of the new company’s voting power while owning more than half the entity.
About Golden Nugget
Golden Nugget Atlantic City has been the market leader for online gambling in New Jersey since it was legalized in 2013. In 2019, Golden Nugget disclosed it earned more than $177 million in internet gaming revenue. The brick and mortar casino merely drew $22 million more than online for the whole year.
So far, in the first ten months of this year, Golden Nugget has reported over $263 million from digital gaming. According to a June news release regarding the merger, the newly established entity will be only the second genuine publicly traded online casino company in the US. The first was DraftKings that went public in April.