Golden Entertainment has disclosed a $322.5m divestment of the group’s distributed gaming operations in Nevada and Montana to J&J Ventures Gaming.

This aforementioned fee, plus $39m of estimated purchased cash at closing, will see J&J Gaming gain operations in Nevada for $213.5m, plus an estimated $34m of purchased cash, with the latter to be acquired for $109m, plus an estimated $5m of purchased cash, subject to customary working capital adjustments.

Furthermore, Golden Entertainment, which owns ten casinos, nine of which are in Southern Nevada and one in Maryland, has also entered into a separate five-year agreement with J&J Gaming.

This will see the company support the gaming operations of Golden’s 60 branded tavern locations in Nevada at financial terms consistent with the company’s past practice.

The aggregate cash consideration plus purchased cash represents a multiple of approximately 9.0x of the adjusted EBITDA for Golden’s distributed gaming segment for the year ended December 31, 2022, of $44m, net of $3.8m of corporate costs allocated to the segment.

The transactions are expected to close prior to year end, subject to customary regulatory approvals and closing conditions

Blake Sartini, Chair and Chief Executive Officer of Golden Entertainment, commented: “Our leading distributed gaming operations in Nevada and Montana were built over the last 20 years through the hard work and dedication of our team members who provide exceptional service and support to our valued route partners. 

“We believe this transaction will provide further success for our route partners through sharing of best practices and new technology. We anticipate our distributed gaming team members will continue to serve our route partners with the same dedication under J&J Gaming’s ownership. 

“Our confidence in J&J Gaming’s future success is highlighted by our new long-term agreement with J&J Gaming to service Golden’s wholly owned tavern portfolio.
“For Golden, these transactions will allow us to focus our management team and capital on our portfolio of wholly owned casinos and taverns in Nevada and create additional value for our shareholders.”

Established almost 100 years ago, J&J Gaming is a privately held business and distributed gaming operator in Illinois, with related operations in several other states.