Golden Nugget Online Gaming (GNOG), the soon-to-be spun off and listed arm of the casino giant, has secured access to Illinois’ sports betting market, partnering the developers building a new Golden Nugget casino in the state.
The 20-year agreement has been struck between GNOG and Danville Development, which will construct the venue in Danville, Illinois, giving the operator exclusive rights to offer sports betting, and if permitted by law in future, online casino gaming.
Danville Development is a joint venture between Wilmot Gaming Illinois, a subsidiary of New York-based real estate developer Wilmorite Management Group, and GN Danville, a wholly owned subsidiary of Golden Nugget.
As part of the agreement, GNOG will provide a $30m mezzanine loan towards the venue’s constriction, and will pay a percentage of net gaming revenue, which will be subject to minimum royalty payments.
“Wilmot is pleased to deliver Golden Nugget and GNOG to the City of Danville and is excited to partner with Tilman J. Fertitta,” Wilmot Management Group vice president James Wilmot said.
“The Golden Nugget is a nationally recognized brand and strengthens the submission, provides additional opportunities, and upgrades the overall project,” he said. “The Wilmot family would also like to personally acknowledge the efforts and support of the City Council and Mayor of Danville; without their diligence and attention to detail this project would not be possible.”
GNOG president Thomas Winter added: “We are thrilled to gain market access in Illinois, the fifth most populous US state and the largest to have regulated mobile wagering to date.
“This is a tremendous opportunity for us to further increase our US footprint and deliver on our ambitious growth plans,” Winter said. “We look forward to bringing our award-winning online offerings to the Prairie State.”
The new property, when opened will operate under the Golden Nugget brand and feature a Landry’s restaurant steakhouse.
“This is Golden Nugget’s first joint venture on a casino project, and we are honored to be the one selected amongst numerous bidders for this opportunity by the Wilmot family after a highly competitive process,” Golden Nugget and GNOG owner and chief executive Tilman Fertitta said.
“Having the ability to grow the Golden Nugget brand in Illinois in both the online and land based markets is an exciting opportunity.”
The deal further extends GNOG’s reach, as the operator prepares to expand into a number of new states in 2021, to build on its market leading presence in New Jersey. The operator is applying for an igaming licence in Pennsylvania, and has secured Michigan market access through a partnership with the Keweenaw Bay Indian Community’s Ojibwa Casino.
The business is also close to completing its spin-off from the main Golden Nugget business, through its merger with special purpose acquisition company Landcadia Holdings II, created through a joint venture with Fertitta and investment bank Jeffries LLC. This is due to complete in November, and will see GNOG shares trade on the Nasdaq Stock Exchange.
With the US gaming industry having shifted online as a result of the novel coronavirus (Covid-19) crisis, GNOG has seen revenue soar during the year. For the third quarter of the year, gross revenue almost doubled to $28.9m, with operating profit also up significantly to $8.2m.