Bally's has new ownership after hedge-fund buyout. What does it mean for RI?

PROVIDENCE – Hedge fund Standard General, the majority shareholder in Bally's, which operates Rhode Island's two state-run casinos, has agreed to purchase the company's remaining shares, according to a Bally's press release.

Bally's announced that it has accepted an $18.25-per-share buyout from Standard General, led by Bally’s chairman Soo Kim.

"There is no impact on Rhode Island operations," said Bally's local spokeswoman Patti Doyle.

The long-contemplated merger, as it is being described, will "require regulatory approval" by Rhode Island gambling regulators, according to state Lottery Director Mark Furcolo, noting "the transaction has not occurred yet."

The deal is expected to close in the first half of 2025.

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Going deeper: Bally's in Rhode Island

Bally's operates casinos for the state in both Tiverton and Lincoln that are cash cows.

The state anticipates paying the company $303 million in the year that began July 1, and netting $315.1 million from the slot-play, $13.6 million from the table game action, $20.2 million from the casino-affiliated sports betting and $24.8 million from iGaming, according to the Lottery.

But the company has struggled as it has expanded its footprint in other venues.

In January 2023, the Rhode Island Lottery and the state's Department of Business Regulation signed off on Bally's sale of the Tiverton casino real estate – along with its Biloxi Hard Rock casino – to Gaming & Leisure Properties [GLPI] under terms where Bally's committed to leasing the casino back and retiring at least $150 million of its debt.

At the same time, Bally's sought more concessions from state lawmakers, which it received with strong backing from Senate leadership despite unanswered questions.

Legislation was sent to the governor allowing Bally's to negotiate "one or more amendments" to its operating agreement with state gambling regulators without legislative approval.

During hearings on the bill, lawmakers asked why that part of the proposed legislation wasn't underlined, as is usual practice, to signal that it was something new and different. Others voiced concern over Bally's doubling its gambling-on-credit limit up to $100,000.

The final vote was 55-11.

Buyout lifts Bally's stock performance

According to a Wall Street Journal report on the buyout, Bally’s stock rose 24% to $16.80 on the news.

"Standard General plans to merge Bally’s with the Queen Casino & Entertainment, a casino chain it already owns," the report reads.

In addition to Standard General, Sinclair Broadcast Group, Inc., which has a financial relationship with Bally's and also owns WJAR-TV in Rhode Island, as well as Gamesys founder and entrepreneur Noel Hayden "have committed to support the merger and to make rollover elections," the company statement said.

The statement says that "at least 47% of Bally’s outstanding fully-diluted equity interests will be rolled over" into the combined company.

Bally's employs around 10,600 people and owns 15 casinos in 10 states, while Queen Casino & Entertainment employs 900 people, with four casinos in three states, according to Wall Street Journal reporting.

This article originally appeared on The Providence Journal: Bally's has new ownership after hedge-fund buyout. What does it mean for RI?