Gateway Casinos and Entertainment might have to wait a while longer until it goes public since Leisure Acquisition Corporation recently issued its latest position on the subject. The company called off the deal striving to purchase the Canadian casino operator following months of inaction. An extension of the deal was inked at the beginning of this month.
Gateway Casinos & Entertainment is striving to be listed on the New York Stock Exchange, as this goal has been on the table for the past couple of years. The Canadian leading casino operator wanted to make it happen with Catalyst Capital Group. The company wanted to merge the casino operator with its US-based company, the plans for which were unveiled in 2019.
Leisure Acquisition Corp Calls Off Deal
The publicly traded special purpose acquisition company is striving to expand its footprint but the unprecedented situation has taken its toll on all parties involved in the plans for public listing. This week saw the special purpose acquisition company call off the purchase agreement with the casino leader. The original goal of Catalyst Capital Group was to buy the privately held Gateway Casinos.
It is interested in an initial public offering process and this would have made it possible. Leisure Acquisition Corporation raises money from this very process, later on using them for its arrangements and purchases. For the time being, the deal would not take place, as it was recently revealed. The special purpose acquisition company did not reveal the reasons behind its decision to call off the previously inked deal.
It amounted to some CA$1.5 billion and it was supposed to see its conclusion back in April 2020. The unprecedented situation eventually made that impossible which called for its extension until the last days of June. The delays and postponing did not end with that, as the first days of this month saw yet another change in the initial schedule for action.
Scrapped Plans
Leisure Acquisition Corporation held a vote on the subject and the predominant opinion was that the deadline should be extended to the beginning of December. Speculations were made back then that the lack of action by any of the sides meant that they are uncertain and their financial situation is not the optimal one for this deal. Either of them had the right to exit the deal come July 15, since no action took place prior to that date.
Gateway Casinos recently shared its own perspective on the situation, pointing out that an earlier vote got in the way of the deal. Back in March, Leisure Acquisition Corporation held a shareholder vote. The casino operator claims that this had a negative impact on their ability to complete a mutually favorable transaction.
For the time being, the special purpose acquisition company has not responded to this claim. The casino operator had to shut down all 25 of its gaming halls and casino venues back in March. They span over provinces to the likes of British Columbia and Ontario, both affected by the lockdown. The gradual reopening of the venues is in progress.
