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Rapidly Acquisition Balks at Fertitta Merger Termination, Could Mean Court Battle

Rapidly Acquisition Balks at Fertitta Merger Termination, Could Mean Court Battle

Posted on: December two, 2021, 03:32h.&nbsp

Last updated on: December 2, 2021, 03:45h.

Quick Acquisition (NYSE:FST), the blank-check business that in February agreed to merge with Tilman Fertitta’s Fertitta Entertainment (FEI), is not playing ball with the Texas billionaire’s efforts to scrap that agreement. That potentially sets the stage for a legal fight.

Tilman Fertitta SPAC
Tilman Fertitta’s namesake entertainment is looking to end a SPAC merger. The blank-check organization strongly objects. (Image: Chris Goodney/Bloomberg)

In February, the parent of the Golden Nugget casinos and the unique objective acquisition firm (SPAC) agreed to a $six.6 billion mixture. That deal would pave the way for the entertainment firm to once more turn out to be a publicly traded company.

In July, much more Landry’s restaurants had been added to the accord, bringing the value of the deal to $eight.6 billion. Landry’s owns more than 500 restaurants across the Bubba Gump’s, Chart House, Del Frisco’s, Mastro’s, and Morton’s brands, among others. Fast also reached an agreement to buy Catch restaurant, including Catch Steak, which is currently 50 percent indirectly owned by Fertitta.

From that point forward, items have been quiet with regards to the mixture, prompting SPAC specialists and observers to ponder why it was taking so lengthy to finalize the transaction. That changed Wednesday when Fertitta’s lawyer sent a letter to Fast detailing plans to terminate the merger due to the fact the merger hadn’t closed.

Fast Objects, Blames Fertitta for Delays

Whilst Fertitta’s gaming and restaurant empire is pointing fingers at Rapidly, the shell business says it’s not its fault the transaction isn’t completed. Actually, it blames Fertitta Entertainment, and mentioned it failed to provide economic statements required.

The statements “are unquestionably the major result in of the failure of the Closing to occur by the Termination Date, and, as such, FEI continues to be bound to its obligations under the Merger Agreement in all respects,” according to a Quick regulator filing.

The SPAC claims that the monetary documents in question weren’t delivered till July — nicely previous the March 31 due date. Quickly believes it faces irreparable harm if the deal falls by way of, and that it will pursue litigation if that happens.

“The Organization additional stated that it intends to take all necessary steps to shield itself and its investors,” it stated in the filing.

SPACs have two years to find a merger companion or threat liquidation. Quick went public in August 2020, so the clock is ticking. Speaking of blank-check agreements, Fertitta notes the circumstance with Quick has no bearing on Golden Nugget Online Gaming (NASDAQ:GNOG) becoming acquired by DraftKings (NASDAQ:DKNG) in a $1.56 all-stock takeover announced in August.

Not Uncommon

It is not uncommon for SPAC offers to fall apart or be terminated. It not too long ago happened in the gaming market, when Wynn Resorts (NASDAQ:WYNN) pulled the plug on plans to bring its Wynn Interactive unit public by way of a merger with a shell firm.

As for FEI going public with no Quickly, there are a lot of queries to be answered on that front.

Rumors of Fertitta’s interest in returning the Golden Nugget/Landry’s operations to public markets surfaced late final year. So did speculation that a classic initial public supplying (IPO) could be challenging to execute since of weakness in the restaurant sector and the company’s $4 billion in debt. Fertitta took the Golden Nugget/Landry’s company private in a 2010 leveraged buyout.

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