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TPG Pace to slot Accel into its portfolio
Posted on Friday, 14 June 2019 14:04
TPG Pace Holdings is buying US-based gaming terminal operator Accel Entertainment for an enterprise value of USD 884.00 million.
The blank check raised USD 45.00 million through a private placement, which will partially be used to pay the target’s shareholders and repay existing debt.
Headquartered in Illinois, Accel is billed as the largest company of its kind in the US based on earnings before interest, taxes, depreciation and amortisation (EBITDA).
It operates more than 8,000 live slot machines across 1,700 locations, with the average establishment earning over USD 78,000 in gaming revenue annually.
Accel’s portfolio also includes bars, restaurants, convenience stores and truck stops.
Through the acquisition, the target will become to the only pure-play listed company to focus on the gaming-as-a-service industry.
As a result, the deal will also help to support Accel’s plans to expand worldwide.
Furthermore, TPG Pace expects the gaming terminal operator to post more than USD 100.00 million in EBITDA in 2020.
Andy Rubenstein, chief executive of the target, said: “As a publicly listed company, we look forward to accessing increased capital to further support our expansion, while remaining laser focused on continuing to deliver to our current location partners the products and services they require to generate additional revenue.”
The deal is expected to complete in late in the third quarter of 2019, subject to regulatory approvals and clearance from Accel’s shareholders.
Upon closing, TPG Pace will be renamed Accel Entertainment, and its shares will remain listed on the New York Stock Exchange.
The buyer is a special purpose acquisition vehicle formed by private equity firm TPG to acquire businesses which will generate strong returns within a public market environment.
Karl Peterson, president of TPG Pace, said: “This transaction is perfectly aligned with our business objectives. Not only is Accel itself a leader, but gaming-as-a-service is one of the fastest growing segments in gaming with a substantial addressable market. “
Zephyr, the M&A database published by Bureau van Dijk, shows there have been 158 deals targeting amusement, gambling and recreation industries announced worldwide since the beginning of 2019.
Only one transaction surpassed USD 1.00 billion and involved Melco Resorts & Entertainment agreeing to buy a 19.9 per cent stake in Australian Crown Resorts for AUD 1.76 billion (USD 1.22 billion).
© Zephus Ltd