Boyd Gaming diversify into the Illinois market with Lattner purchase
Boyd Gaming has diversified its holdings by entering the $1.2 billion Illinois gambling market after acquiring Lattner Entertainment.
The $100 million cash consideration purchase gives Boyd Gaming a nice chunk the Illinois Video Gaming Terminal industry.
Lattner Entertainment currently has 1000 gaming units in 220 locations across Illinois, which has close to 24,000 units active, after only legalising them in 2012, with this number expected to swell by a further four thousand by the end of the financial year.
“The acquisition of Lattner is a strategic opportunity to further diversify and expand our business,” Keith Smith, President and Chief Executive Officer of Boyd Gaming, said.
“Lattner will provide us a valuable new avenue to access gaming customers, and a platform to participate in the expansion of distributed gaming.“
The sale price is approximately eight times the earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA), with incremental growth and cost synergies also included in the estimates.
Boyd Gaming believes the purchase will be cash flow positive and profitable within years of the sale.
The sale is expected to be finalised by the end of the second quarter of 2018, with some hurdles still to pass, including regulatory requirements.
Boyd Gaming also revealed it would finance the purchase by using existing cash flow and credit facilities.