Dover Downs Gaming & Entertainment and Twin River Worldwide Holdings are to merge.
Twin River owns and manages two casinos in Rhode Island, the Hard Rock Hotel & Casino in Biloxi, Mississippi. The company also owns a Colorado horse racetrack.
Dover Downs’ President and CEO, Denis McGlynn stated,
“Becoming part of Twin River is transformational for us. We have been impressed with the depth and talent of the Twin River organization and their operational capabilities. We believe this transaction will help us grow our business, invest in our people and our facilities and compete more effectively given changes in gaming on the horizon. We expect to see many positive benefits for the State, the Delaware Lottery and our employees and stockholders.”
Legal sports betting is part of the deal rationale
Twin Rivers Executive Chairman John E. Taylor, Jr, quoted the sports betting opportunity as one of the specific reasons for its enthusiasm for the deal:
“We’re excited about the many benefits we believe we will realize from the combination. Dover Downs and its team are experienced in not only brick and mortar casino operations, but in sports betting, which we think will be helpful as we introduce that amenity at our properties, and in the online gaming sector which continues to evolve nationwide. Equally important, we see real opportunities to grow the Dover Downs business through investment in its people and facilities, similar to what we have achieved with our other assets over the past several years.”
Almost 300 miles separate the Rhode Island business from Dover Downs in Delaware. However, distance is no barrier to the merger. Not when the ultimate goal is to achieve scale.
Twin River spokeswoman Patti Doyle said:
“The size of the combined company should bring meaningful economies of scale, likely in the areas of healthcare, insurance and food and beverage, and new opportunities for future expansion.”
Expect finalized deal in early 2019
Twin River is a private company. As such, the law requires the company to list its shares on NASDAQ or the NYSE before the merger. This is to ensure the deal completes at a fair value.
Dover Downs is already a public company. In fact, the markets have already given it a big thumbs up for the deal. On Monday. after the announcement, Dover Downs shares rose by 50 percent.
The deal still has to jump through several regulatory hoops, so McGlynn thinks it will be Q2 2019 before everything is complete:
“This is the beginning of a process that probably will take six to nine months to conclude.”