GCasino and MeccaBingo owner Rank Group is to become the largest bricks ‘n’ mortar casino owner in the UK after agreeing a deal to buy Gala Casinos.
Rank has conditionally agreed to pay £205m in cash for 23 of Gala’s casinos, the successful acquisition of which would see Rank run 58 licensed properties in the UK, leapfrogging Malaysian casino operator Genting, which currently has 44. Rank will fund the buy through new three-year bank facilities of £175m as well as extending existing terms.
The announcement of the conditional agreement this mornng follows the two parties finding workable solutions to the issues – reportedly relating to Gala Casinos’ pension liability and property ownership – that led to the breakdown of initial talks in late March. The deal excludes Gala Coral’s Gibraltar and Dundee casinos and freehold properties owned by Gala Coral.
Chairman and CEO of Rank Ian Burke said the company was delighted to have agreed terms with owners Gala Coral and that the buy would “deliver a step change in Rank’s earnings”. The company said it expected the transaction to be earnings enhancing for Rank in the first full year of ownership.
The company will rebrand nine of the acquired properties under its G Casino offline and online brand, and extend Rank’s land-based casino estate into 11 UK cities currently unserved by its current chain of 35 properties.
The acquisition, which Rank said its expects to complete before the end of third quarter on 30 September, is conditional upon the approval of Rank shareholders and clearance by UK merger authorities.
Rank’s 74.5% majority shareholder, Malaysian investment conglomerate Guoco Group, has already said it will vote in favour of the acquisition at a soon-to-convened general meeting.
