TUNICA, MISS. — Full House Resorts Inc. (NASDAQ: FLL) has entered into a definitive agreement to buy the 53-acre Fitzgerald’s Casino in Tunica from The Majestic Star Casino LLC for $62 million.
Majestic Star, based in Indiana, filed for Chapter 11 bankruptcy protection in 2009, leaving the “Fitz Casino” available for purchase, according to the Memphis Business Journal. Las Vegas-based Full House, which owns five casinos in Nevada, New Mexico, Indiana and Mississippi, also purchased the Silver Slipper Casino in Bay St. Louis, Miss., in 2012 for $70 million.
The Fitz Casino features 38,000 square feet of gaming space, including approximately 1,100 slot and video poker machines, as well as 20 table games. The site also includes a 506-room hotel with 68 suites, a fine dining restaurant, buffet, two casino bars and an 8,100-square-foot event center.
“This transaction is consistent with our long-stated growth strategy,” says Andre Hilliou, chairman and CEO of Full House Resorts, “and we believe it will create long-term shareholder value. We believe we can leverage our knowledge and proven track record of managing properties catering to local customers to further improve the profitability of Fitz Casino.”
According to a press release, Macquarie Capital was Full House’s financial advisor on the transaction. The purchase agreement is subject to Full House’s ability to obtain financing within 90 days, obtain regulatory approvals and satisfy other customary closing conditions.
The purchase price is exclusive of working capital and other adjustments, fees and expenses. Full House anticipates closing on the purchase in the third quarter of this year.
Full House plans to fund the purchase of the Fitz by refinancing its current credit facilities with a new credit facility with a capacity of approximately $125 million and through an equity offering. The proceeds will also be used to fund renovations of approximately $7 million.
The company's stock price closed at $2.33 per share on March 24, down from $2.84 per share a year ago.
— Scott Reid