Nevada regulators Thursday paved the way for Golden Entertainment to sell its Nevada slot operations to J&J Ventures Gaming for $213.5 million and $34 million in purchased cash. Just as the Nevada Gaming Control Board did earlier this month, the Nevada Gaming Commission unanimously approved signing off on the transaction.
The deal is expected to close in mid-January after being moved back from the end of December. The parties needed more time to complete regulatory filings and attend to financial considerations, officials said.
J&J previously acquired Golden Entertainment’s Montana slot operations for $109 million, plus $5 million in purchased cash.
Golden will enter a five-year agreement with J&J Gaming, under which J&J will support the gaming operations of Golden’s branded tavern locations in Nevada.
J&J Gaming is a privately held business and a leading distributed-gaming operator in Illinois and other states. Los Angeles-based private-equity firm Oaktree Capital Management is its majority owner. Oaktree recently closed on the purchase of the Casablanca Resort and Virgin River Hotel & Casino in Mesquite.
Oaktree invested in J&J in 2019 and since then has made 13 other acquisitions and grown revenue by 3½ times. With this acquisition, it will be fivefold. Their capital investment started at $155 million and will be almost $300 million in equity. With this acquisition, J&J says it will be the market leader in the U.S and have about 25,000 VGT in 3,500 locations in five states.
J&J announced plans to incorporate the Nevada structure into its bigger operations and file an application with state regulators for that in the future.
The deal came about because Matthew Wilson, Oaktree’s managing director, attended college with Golden Entertainment President and CFO Charles Protell, according to David Quick, a managing director with Oaktree.
“Distributive gaming isn’t a huge industry and there’ve been conversations for many years, and we had a lot of respect (for Golden executives) for what they did,” Quick said. “It made sense to have that business from Golden within Nevada and Montana.”
Yahoo Finance reported this week that Protell sold 35,946 shares of Golden Entertainment stock on Wednesday with an average price of $40.85 and a sales amount of $1.46 million.
“I applaud the transaction,” said Commissioner Brian Krolicki and thanked the contribution of Golden Entertainment in Nevada.
Golden plans to focus on its tavern business and casino operations in Nevada.
