Great Canadian Gaming Corp (TSX: GC) and Canadian private equity firm Clairvest Group have closed their acquisition of casino assets in the West Toronto region. Terms weren’t disclosed at the time of the deal’s announcement in December; however, with the close the investors released a purchase price of about $134 million. Great Canadian and Clairvest own a respective 55 percent and 45 percent interest in a partnership that will run, modernize and further develop the facilities. The partnership entered into a five-year credit agreement to fund 65 percent of the acquisition and provide financing for an initial capital development program.
PRESS RELEASE
Great Canadian Gaming and Clairvest Group Inc. Complete Acquisition of the West GTA Bundle in Ontario Gaming Modernization Process
May 1, 2018 – Coquitlam, BC and Toronto, ON – Great Canadian Gaming Corporation (TSX: GC) (“Great Canadian”) and Clairvest Group Inc. (TSX:CVG) (“Clairvest”), through its Clairvest Equity Partners V partnerships, announced today that they have successfully completed the acquisition of the gaming assets in the West Greater Toronto Area (the “West GTA Bundle”) for a purchase price of approximately C$134 million.
Great Canadian and Clairvest established the Ontario Gaming West GTA Limited Partnership (“the Partnership”), in which Clairvest owns 45% and Great Canadian owns 55%. The Partnership was selected as the successful proponent by the Ontario Lottery and Gaming Corporation (“OLG”) to operate the following West GTA gaming facilities: OLG Casino Brantford, OLG Slots at Mohawk Racetrack, OLG Slots at Flamboro Downs and OLG Slots at Grand River Raceway.
The Partnership has signed a casino operating and services agreement (“COSA”) with OLG to take over day-to-day operations of the gaming facilities in the West GTA Bundle. The Partnership has entered into a five year credit agreement that has funded approximately 65% of the acquisition costs and will provide financing for the initial capital development program of the Partnership.
Effective May 1, 2018, the West GTA facilities will be re-named as Elements Casino Brantford, Elements Casino Flamboro, Elements Casino Grand River and Elements Casino Mohawk. These facilities have a combined total of over 2,500 slot machines, approximately 60 table games, employ more than 1,400 staff and generated approximately $460 million in gross gaming revenue in fiscal 2017/18.
In accordance with the COSA, the Partnership will have the exclusive right to operate these facilities for a minimum period of 20 years.
With the transition process complete, the Partnership will focus on initiatives and capital investments that will modernize and broaden the guest experience at each facility. The Partnership intends to work closely with stakeholders as it enhances and transforms the facilities located in the West GTA Bundle, while maintaining a focus on responsible gambling.
About Great Canadian Gaming Corporation:
Founded in 1982, Great Canadian Gaming Corporation is a BC based company that operates 28 gaming, entertainment and hospitality facilities in Ontario, British Columbia, New Brunswick, Nova Scotia, and Washington State. Fundamental to the company’s culture is its commitment to social responsibility. “PROUD of our people, our business, our community” is Great Canadian’s brand that unifies the company’s community, volunteering and social responsibility efforts. Under the PROUD program, Great Canadian annually invests over $2.5 million in our communities, and in 2017, over 1,900 charitable organizations were supported by Great Canadian. In each Canadian gaming jurisdiction, a significant portion of gross gaming revenue from gaming facilities is retained by our crown partners on behalf of their provincial government for the purpose of supporting programs like healthcare, education and social services.
Media Contact:
Sonja Mandic
Director, Media Relations and Social Responsibility
Great Canadian Gaming Corporation
Tel: 604.889.7114
Email: smandic@gcgaming.com
About Clairvest:
Clairvest Group Inc. is a private equity management firm that invests its own capital, and that of third parties through the Clairvest Equity Partners limited partnerships, in businesses that have the potential to generate superior returns. In addition to providing financing, Clairvest contributes strategic expertise and execution ability to support the growth and development of its investee partners. Clairvest realizes value through investment returns and the eventual disposition of its investments.
Media Contact:
Maria Shkolnik
Director, Investor Relations and Marketing
Clairvest Group Inc.
Tel: 416.925.9270
Fax: 416.925.5753
www.clairvest.com
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