Isle of Capri Casinos to acquire Lady Luck Gaming for 0.38 times revenue

Weekly Corporate Growth Report, Oct 18, 1999

The Deal: Isle of Capri Casinos Inc. has agreed to acquire Lady Luck Gaming Corp. for $59 million in cash and the assumption of $177 million in debt. The acquisition will make Isle of Capri one of the ten largest public gaming companies in the U.S. Lady Luck shareholders will receive $12.00 for each of their shares.

Discussion: Lady Luck Gaming Corp. owns casinos. Its two barge casinos Luck Rhythm & Blues Casino Hotel and Lady Luck Country Casino in Lula, Mississippi offer a combined 1,560 slots and 50 gaming tables. The company also owns an entertainment center, six restaurants, and three nearby hotels. Lady Luck Casino Hotel Natchez, a dockside facility in Natchez, Mississippi, has 630 slots, 20 gaming tables, and a hotel. The company also owns 50% of the Lady Luck Casino Bettendorf in Bettendorf, Iowa which features 1,150 slot machines, 50 gaming tables, and a hotel.

Isle of Capri owns and operates seven riverboat, dockside, and land-based casinos at six locations. The gaming facilities include the Isle of Capri Casino and Crowne Plaza Resort in Biloxi, Mississippi, and the Isle of Capri Casinos in Vicksburg, Mississippi; Bossier City, Louisiana; and Black Hawk, Colorado, as well as two riverboats operating as the Isle of Capri Casino in Lake Charles, Louisiana.

The company also operates Pompano Park Harness Racing Track in Pompano Beach, Florida. The transaction will allow the Isle of Capri brand to expand into new venues throughout the country and will provide diversity to its customers.