By Lisa Kerner
Charlotte, N.C., Nov. 12 - Churchill Downs, Inc. announced it will acquire Youbet.com, Inc. in a deal valued at approximately $126.8 million.
Youbet shareholders will receive a fixed ratio of 0.0598 shares of Churchill Downs common stock plus $0.97 in cash for each share of Youbet common stock they own, according to a joint news release from the companies.
Based on the closing price of Churchill Downs common stock on Tuesday, the per-share price for Youbet stock is about $2.84. This is a premium of 28% over the closing price of Youbet common stock on Tuesday.
Both companies' boards of directors have approved the deal, which is expected to close in the first or second quarter of 2010.
Some Youbet shareholders and directors agreed to vote their collective 24% stake in favor of the merger.
Youbet executive chairman Michael Brodsky will join the board of Churchill Downs and its executive and strategy committees, the release said.
The companies expect their combination to result in $10 million in annualized cost savings within the first 12 months of the merger's closing.
"We believe this combination should enable us to accelerate the development of new technology-enabled features and services that horse racing customers who wager via the ADW [advanced deposit wagering] channel want, and that can attract new customers to racing," Churchill president and chief executive officer Robert L. Evans said in the release.
Churchill Downs was advised by Imperial Capital and Sidley Austin LLP. Moelis & Co., Kirkland & Ellis LLP and Olshan Grundman Frome Rosenzweig & Wolosky LLP advised Youbet.
Louisville, Ky.-based Churchill Downs owns and operates pari-mutuel wagering properties and businesses in the United States.
Youbet, based in Woodland Hills, Calif., provides internet and telephone platform technologies for wagering on horse races.
| Acquirer: | Churchill Downs, Inc.
|
| Target: | Youbet.com, Inc.
|
| Announcement date: | Nov. 11
|
| Price per share: | 0.0598 Churchill Downs shares plus $0.97 in cash
|
| Transaction total: | $126.8 million
|
| Expected closing: | First or second quarter of 2010
|
| Stock price for acquirer: | Nasdaq: CHDN: $31.19 on Nov. 10
|
| Stock price for target: | Nasdaq: UBET: $2.22 on Nov. 10
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
