Great Canadian Gaming Corporation is considered one of the leaders in the Canadian gambling field and over the past few weeks, there is news around it galore. Recently it became clear that yet another stakeholder in the casino leader has expressed its opposition to the proposed acquisition deal that could see Apollo Global Management Inc. purchase the operator.
Burgundy Asset Management, one of the three largest stakeholders in Great Canadian Gaming Corporation recently made it clear that it is unsatisfied with the proposed conditions part of the definitive agreement which was inked earlier this month. The shareholder owns some 9.5 percent of the gaming leader and its opposition marks an important moment.
Burgundy Asset Management
Mid-November, Canada’s gaming field witnessed a major move being made, one of its leading casino operators entered a definitive agreement for its purchase. Great Canadian Gaming Corporation wants to be acquired by Apollo Global Management, Inc. striving to improve its gambling and hospitality potential. The acquisition will amount to some CA$2.1 billion in Great Canadian Gaming common stock.
This announcement stirred the pot on a national level, but there were also many supporters of this move. Great Canadian Gaming’s Chief Executive Officer Rod Baker was among the executives announcing the inking of the definitive agreement and he expressed his contentment with the conditions arranged and the overall vision for future operation. However, this enthusiasm was not shared by some of the shareholders expressing their position.
Burgundy Asset Management recently pointed out that the conditions of the arrangement are not favorable for the shareholders associated with the casino operator. According to the recent statement, the proposed price for the purchase and for the individual shares is too low. It should be noted that Great Canadian Gaming Corporation oversees a total of 25 gaming locations in British Columbia, Ontario, and Nova Scotia, and New Brunswick.
December Stakeholders Meeting
As Burgundy Asset Management put it, this was supposed to give a higher price to the acquisition, making it a better one for all parties involved. The month of December is projected to see the official shareholders meeting bringing a vote on the subject. This is when the companies opposing this decision will get the chance to cast their vote and they claim it will be a negative one.
Burgundy Asset Management pointed out that the unprecedented situation has put pressure on the casino operator and its shares, which eventually affected the definitive agreement inked. According to the shareholder, $39 per share amounts to only a fraction of the real value of these shares. CI Global Asset Management is the casino leader’s largest shareholder but for the time being, it has not made its position public.
Bloombergsen Investment Partners was also among the shareholders opposing this decision. The Toronto-based investment firm owns about 14 percent of the casino leader’s equity. Earlier this month it pointed out that the proposed payment coming from Apollo Global Management would not be lucrative down the road. Madison Avenue Partners and Breach Inlet Capital also own a percentage and they will vote against the acquisition.