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26 Capital Acquisition Corp. *

26 Capital Acquisition Corp. *

Dec 23, 2020 by Kristi Marvin

The below-announced combination was terminated on 9/21/23.  It will remain on the page for reference purposes only. Once a new combination is announced it will be added to the top of the page.

PROPOSED BUSINESS COMBINATION: Okada Manila

ENTERPRISE VALUE: $2.6 billion
ANTICIPATED SYMBOL: TBD

26 Capital Acquisition Corp. proposes to combine with Okada Manila, one of the premier destination casino resorts in Asia and the largest integrated resort in the Philippines.

Okada Manila resort sits on over 50 acres of prime waterfront real estate in Entertainment City, Manila. The resort currently boasts nearly 35,000 square meters of gaming space and has the capacity to operate 599 gaming tables and 4,263 electronic gaming machines. Upon full completion of construction in 2022, Okada Manila will have licensed capacity to operate 974 gaming tables and 6,890 electronic gaming machines. When fully completed, Okada Manila will feature two towers with 993 luxury hotel rooms, a retail boulevard with capacity for more than 50 shops, Cove Manila night club and indoor beach club, more than 25 dining options, and one of the world’s largest multicolor dancing and musical fountains. The Okada Manila resort cost $3.3 billion to construct and began to progressively open throughout 2019 following the completion of its first hotel tower. In 2022, following full construction completion, the property will be able to operate at full capacity for the first time.

Okada Manila has the leading gaming operating capacity in Entertainment City, a market that grew by 24% annually between 2013 and 2019 and achieved gross gaming revenue (GGR) in 2019 of over $3.3 billion. In addition to being a major tourist destination and one of the fastest growing gaming markets in Asia, the Philippines provides a very favorable environment for gaming businesses relative to competing geographies due to competitive labor costs, no corporate tax for gaming revenue, and gaming licenses that are coterminous with PAGCOR, the local gaming regulator, with a franchise that is renewable indefinitely. In addition to significant future growth expected from domestic and tourist gaming visitors, Okada Manila will also benefit from the newly regulated online domestic gaming market, the opportunity to potentially expand through utilization of excess land in the Philippines, and potential participation in a future integrated resort development in Japan.

LIQUIDATION – 9/21/23 – LINK

  • The Company anticipates that the last day of trading in the Class A ordinary shares will be September 25, 2023.
    • The per-share redemption price will be approximately $10.95

EXTENSION – 12/20/22 – LINK

  • The SPAC approved the vote to extend the date by which the Company must consummate its initial business combination from January 20, 2023 to October 20, 2023
    • 24,069,772 (87.526%) shares were redeemed.

SUBSEQUENT EVENT – 9/30/22 – LINK

  • Per the terms of an amendment signed today, UERI and 26 Capital have both agreed to extend the date on which either party could terminate the transaction contemplated in the Agreement from October 1, 2022, until October 1, 2023.

SUBSEQUENT EVENT – 6/14/22 – LINK

  • 26 Capital Acquisition Corp. announced that the record date and the meeting date for the special meeting of its stockholders to approve the transactions contemplated by the Merger Agreement will be rescheduled and announced as soon as is practical.
  • The Company also announced that they extended the deadline of the Merger Agreement from June 30, 2022, to September 30, 2022, subject to agreement with 26 Capital.

TRANSACTION

  • The business combination values Okada Manila at an enterprise value of $2.6 billion and at an equity value of $2.5billion.
  • 26 Capital Acquisition Corp. is anticipated to provide up to $275 million of cash held in 26 Capital’s trust account from its initial public offering in January 2021.
  • Okada Manila intends to use 26 Capital Acquisition Corp.’s available cash for growth opportunities and general corporate purposes.
  • Universal Entertainment Corp. will roll 100% of its equity in the transaction and is expected to own approximately 88% of the combined company at closing, assuming no redemptions by shareholders of 26 Capital Acquisition Corp. This is subject to dilution if further capital is raised as part of the transaction prior to closing.

26 Capital Transaction Overview

PIPE

  • There is no PIPE for this transaction at this time.

LOCK-UP

  • Prior to the expiration of the Lock-up Period or the Private Placement Lock-up Period, no Holder of Sponsor Registrable Securities or Insider may sell or transfer shares for the period beginning on the Effective Time and continuing to and including the date that is the earlier of:
    • (a) the one year anniversary of the Effective Time
    • (b) the date on which the Stock Price of the ADSs equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 Trading Days within any 30-trading day period commencing at least 150 days after the Effective Time.

NOTABLE CONDITIONS TO CLOSING

  • There is no minimum cash at closing listed.

NOTABLE CONDITIONS TO TERMINATION

  • Subsequent Event – 9/30/22 – Per the terms of an amendment signed today, UERI and 26 Capital have both agreed to extend the date on which either party could terminate the transaction contemplated in the Agreement from October 1, 2022, until October 1, 2023.
  • Subsequent Event – 6/14/22 – The Company also announced that they extended the deadline of the Merger Agreement from June 30, 2022, to September 30, 2022, subject to agreement with 26 Capital.
  • The Merger and Share Acquisition Agreement may be terminated at any time prior to the Closing in the event the Closing does not occur by July 1, 2022.

ADVISORS

  • Baker McKenzie Tokyo and Milbank LLP served as legal counsel for Universal Entertainment Corporation and Okada Manila.
  • Schulte Roth & Zabel served as legal counsel for 26 Capital Acquisition Corp.

MANAGEMENT & BOARD

Executive Officers

Jason Ader, 52
Chief Executive Officer and Chairman

Mr. Ader is the co-founder and Chief Executive Officer of SpringOwl Asset Management LLC. Founded in 2013, SpringOwl is a New York-based SEC-registered asset management firm and independent sponsor leading corporate turnarounds, with a particular focus on the real estate, gaming and lodging sectors. Mr. Ader has been involved in turning around companies in the gaming and hospitality industry for many years, including with the Las Vegas Sands Corp. where he served as an independent director from 2009-2016, IGT, The Stars Group and most recently, Playtech. Mr. Ader earned his MBA in Finance from New York University and a BA in Economics from New York University.

John Lewis, 57
Chief Financial Officer

Mr. Lewis is the Chief Financial Officer of SpringOwl Asset Management LLC. He spent the past 22 years in the hedge fund industry as a Chief Financial Officer and controller, including a combined 17 years at SpringOwl Associates LLC (formerly known as Cumberland Associates LLC) and three years at Ardea Capital Management LP, a start-up hedge fund. Prior to that, he was assistant controller at a mid-sized retail/wholesale corporation with 17 stores. He has a BA in accounting from The State University of New York at Oswego. He is also a New York State Certified Public Accountant and member of the AICPA.

Board of Directors

Rafi Ashkenazi, 46
Director

Mr. Ashkenazi has served as a non-executive director of gaming company Flutter Entertainment Plc. until August 2020. Previously, Mr. Ashkenazi served in various roles at gaming company The Stars Group Inc. from January 2013 until its merger with Flutter Entertainment in May 2020. Mr. Ashkenazi served as CEO at The Stars Group from March 2016 to May 2020, COO from January 2013 to March 2015. From January 2006 to January 2013, Mr. Ashkenazi served in various roles at gaming company Playtech PLC, including COO from January 2006 to January 2010 and then from September 2011 to December 2012. Mr. Ashkenazi earned a B.A. in industrial engineering from Shankar College in Israel in 2002.

Joseph Kaminkow, 62
Director 

Since October 2018, Mr. Kaminkow has served as Special Advisor to the Chief Product Officer at Aristocrat Technologies Australia Pty Ltd., a leading gaming provider and games publisher. Mr. Kaminkow previously served as Aristocrat’s Chief Innovation Officer from May 2013 to October 2018. Mr. Kaminkow also currently serves as Vice President of Game Design at Zynga Inc., where he has been since September 2019. He previously served as Zynga’s Chief Game Designer from June 2012 to September 2019. From August 2010 to June 2012, Mr. Kaminkow served as CEO of software company Spooky Cool Labs, LLC. Mr. Kaminkow earned a B.A. from Curry College in 1983.

Gregory S. Lyss, 58 [Removed 5/18/21]
Director 

Mr. Lyss serves as our Chief Operating Officer. Mr. Lyss also serves as on the investment team of Saddle Point Management, L.P. (“Saddle Point”). Founded in 2018, Saddle Point is a New York-based SEC-registered asset management firm. From 2011 to 2019, he served as the Chief Investment Officer for TABLE Management, L.P., a single family office. Prior to TABLE, Mr. Lyss was a partner and analyst at Alson Capital Partners, L.P., an investment manager to multibillion dollar hedge funds. Mr. Lyss had previously worked as an investment analyst at Gotham Partners, L.P. and co-founded Cohanzick Management, L.P., a private investment partnership. Prior to Cohanzick Management, Mr. Lyss worked as an analyst for Leucadia National Corporation (now Jeffries Financial Group Inc.). Mr. Lyss serves on the board of directors of Alpha Precision Media Inc. (an Amazon media buying specialist). He previously served on the boards of Calendre Company, MD Insider, and Maverick Brands. He currently serves as the Treasurer and a member of the Board of UJA-Federation of New York, one of the largest local philanthropy in the U.S. Mr. Lyss received his A.B. from Harvard College and an M.B.A. from Harvard Graduate School of Business.

J. Randall Waterfield, [Appointed 5/18/21]
Director 

Mr. Lyss serves as our Chief Operating Officer. Mr. Lyss also serves as on the investment team of Saddle Point Management, L.P. (“Saddle Point”). Founded in 2018, Saddle Point is a New York-based SEC-registered asset management firm. From 2011 to 2019, he served as the Chief Investment Officer for TABLE Management, L.P., a single family office. Prior to TABLE, Mr. Lyss was a partner and analyst at Alson Capital Partners, L.P., an investment manager to multibillion dollar hedge funds. Mr. Lyss had previously worked as an investment analyst at Gotham Partners, L.P. and co-founded Cohanzick Management, L.P., a private investment partnership. Prior to Cohanzick Management, Mr. Lyss worked as an analyst for Leucadia National Corporation (now Jeffries Financial Group Inc.). Mr. Lyss serves on the board of directors of Alpha Precision Media Inc. (an Amazon media buying specialist). He previously served on the boards of Calendre Company, MD Insider, and Maverick Brands. He currently serves as the Treasurer and a member of the Board of UJA-Federation of New York, one of the largest local philanthropy in the U.S. Mr. Lyss received his A.B. from Harvard College and an M.B.A. from Harvard Graduate School of Business.

 

ByKristi Marvin