Leisure Acquisition Corp., based in New York, has pulled out of its bid to merge with the Canadian-based Gateway Casinos & Entertainment Ltd.
Leisure originally announced its plans to merge with Gateway in December, which would have been a $1.1 billion deal. Gateway is one of the largest gaming companies in Canada, with casinos in Alberta, British Columbia and Ontario. It sought the deal in order to go public. That deal should have closed in April, but was extended due to the Covid-19 outbreak.
Leisure is operating under the gun. It is a special purpose acquisition company (SPAC) that must find a company to acquire by December 1 or return its money to shareholders.
For its part, Gateway, which has more than two-dozen properties in Canada, has been trying to sell shares after filing for its IPO in November 2018, only to withdraw the IPO a year later. Catalyst Capital Group Inc., which backs Gateway, commented through a spokesman: “It is unfortunate that the LACQ shareholder vote in March, at the peak of the global COVID pandemic, negatively influenced their ability to complete a transaction that was favorable to all the parties involved. Regardless, Gateway is an exceptional franchise and has been successful in building its business across Canada, creating long-term value for its various stakeholders.”
