Z Capital Partners buys Affinity Gaming, Lakeside Casino

There’s a new name to the owner of Lakeside Hotel and Casino, but it’s a familiar one to the company.

According to a corporate press release, Z Capital Partners, the private equity management arm of Z Capital Group LLC, a global alternative investment manager focused on opportunistic, value-oriented private equity and credit funds, and Affinity Gaming, a diversified casino gaming operator, announced they have entered into an agreement for Z Capital to buy Affinity in an all-cash transaction that values Affinity at approximately $580 million.

“It doesn’t mean you’re going to see anything different locally at the property,” said Joseph Jaffoni, spokesperson for Affinity, during a phone interview with the Osceola Sentinel-Tribune.

‘Concentration of ownership’

Under the terms of the agreement, Z Capital and its affiliates, which currently own approximately 41 percent of Affinity’s outstanding shares, will purchase Affinity’s remaining outstanding shares for $17.35 per share in cash.

Jaffoni said the situation is more of a concentration of ownership, and Z Capital has been a majority shareholder for the past several years.

Z Capital has received a debt-financing commitment in the amount of $465 million from Citizens Bank, National Association.

“We are pleased to enter into the agreement to purchase Affinity and transition from the largest shareholder to sole controlling shareholder,” said James Zenni, president and chief executive officer of Z Capital and member of the Affinity Board of Directors since 2014, in the press release. “Affinity brings a compelling offer to consumers by providing high-quality entertainment at affordable prices in attractive markets, and I am confident that Z Capital is uniquely positioned to grow the business for years to come. We look forward to leveraging our broad expertise across the hospitality, restaurant, retail and consumer sectors to help Affinity continue to expand, while driving profitability through operating improvements and enhanced efficiencies.”

‘No change’

Affinity was founded in 2010 and headquartered in Las Vegas.

It offers accessible, value-oriented casino entertainment in a welcoming and casual atmosphere. It currently has 11 locations in key markets across Nevada, Colorado, Missouri and Iowa.

“There’s no change to the senior management, and I think they’ve been very happy with the way they’ve managed Lakeside since they’ve taken it over,” Jaffoni said.

The transaction is expected to close in the first quarter of 2017, subject to the approval by Affinity shareholders; regulatory approvals, including by gaming regulators in the four states where Affinity is licensed; expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other customary closing conditions.

As of Aug. 22, shareholders representing approximately 69 percent of Affinity’s outstanding shares have entered into voting agreements in support of the transaction.

“It’s going to be business as usual,” Jaffoni said.