Okada Manila valued at $ 2.6 billion in deal with Jason Ader SPAC
Posted on: Oct 16, 2021, 4:01 a.m.
Last update on: October 16, 2021, 04: 24h.
Okada Manila, World’s Only Integrated Japanese-Owned Resort, Merges With Jason Ader’s Special Purpose Acquisition Company (SPAC) 26 Capital (NASDAQ: ADER) in Deal Enhancing Gaming Site to $ 2.6 billion.
The announcement ends months of speculation about which shell company the games company would merge with as it seeks to be listed in the United States. In February, Okada Manila said she was looking for a PSPC partner in an effort to get a listing on the Nasdaq or the New York Stock Exchange (NYSE). After the transaction closes, which is slated for June 2022, Okada Manila shares will debut on the Nasdaq. Talks between the casino operator and 26 Capital began in July.
The transaction involves an enterprise value for Okada Manila of $ 2.6 billion and is expected to provide Okada Manila up to $ 275 million in cash, ”according to a statement.
This is on the safe side of the gaming industry / blank check offerings so far. Universal Entertainment, the Japanese pachinko giant that is the parent company of Okada Manila, is investing 100 percent of the casino operator’s capital, and Ader’s 26 Capital is providing up to $ 275 million in cash to the company.
Okada Manila: small list, big potential
Assuming it doesn’t acquire another site until its Nasdaq debut, Okada Manila will be the smallest listed gaming company in the United States in terms of number of casinos, with just one. This distinction currently belongs to Monarch Casino & Resort (NASDAQ: MCRI), which currently only owns two properties.
Still, Okada Manila offers investors a lot of potential. This is because, in the absence of the coronavirus, the Philippines is a dynamic and growing gaming market, and Japanese society has an enviable position there. Okada Manila is the largest casino in the Entertainment City area in terms of both gross area and gross playing area. Gross gaming revenue (GGR) in this district was skyrocketing before the pandemic, increasing 24% per year for the seven-year period ending in 2019.
“Okada Manila is expected to experience tremendous future growth by tapping into strong pent-up demand following the relaxation of travel and hospitality restrictions,” the statement said. “This transaction allows the company to expand in the Philippines and look outside its current market to other growing markets.”
When the ongoing improvements are completed next year, Okada will be home to 974 table games and nearly 6,900 gaming machines. The company also mentions that it could potentially participate in a future integrated complex in Japan.
Ader’s involvement, a coup for Okada Manila
The deal comes at a time when some members of the investment community are denouncing PSPC’s sponsors. They indicate that some stocks sell quickly or do not have adequate experience in the industry of the target company, Ader’s involvement with Okada Manila stands out in a positive way.
Ader’s ties to the gaming industry run deep. Before going on his own, he was a games and hosting analyst at Bear Stearns. Institutional investor recognized him as the best among his peers for 10 consecutive years. He was then a member of the board of directors of Las Vegas Sands from 2009 to 2016..
In 2015, he orchestrated the takeover of online gaming company Bwin.party by the company now known as Entain Plc. In 2018, Ader’s SpringOwl Asset Management took a stake in gaming software provider Playtech – a name that has been mentioned as a target of the takeover.
That said, Ader has experience with iGaming which is relevant for Okada Manila as the Philippines has a new regulated online gaming market.