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CANNERY PRESS RELEASE
Cannery Casino Resorts and Crown Terminate Merger Agreement; Crown to Make
Investment into CCR
Cannery Casino Resorts to Receive $370 Million
LAS VEGAS, March 12, 2009 -- Cannery Casino Resorts LLC ("CCR") today
announced that it has entered into an Agreement with Crown Limited (ASX:
CWN) under which CCR will receive $370 million from Crown, which will
consist of a $50 million cash fee and a $320 million non-voting investment
in CCR, subject to appropriate regulatory approvals. The Agreement
terminates the previously announced Cannery Purchase Agreement whereby CCR
was to be acquired by Crown.
"Today's announcement puts CCR in an enviable position in the gaming
industry with a strong balance sheet, ample liquidity, exciting new
properties in Nevada and Pennsylvania, great growth opportunities and more
certainty for our employees. CCR will continue its tradition of excellence
in serving local customers in Nevada and Pennsylvania with the highest value
gaming experience," said CCR's co-CEO, Mr. Bill Paulos.
"We are well positioned to take advantage of market conditions to grow our
brand and aggressively market our properties," said Mr. Bill Wortman, CCR's
co-CEO. "My business partner and I look forward to running and growing our
business in conjunction with our financial partners at Oaktree Capital, and
we are truly excited about Cannery's future prospects in this time of
dramatic change in the gaming industry."
Stephen Kaplan, a Principal at Oaktree Capital, a significant investor in
CCR, said, "I am pleased with our company's relative performance in a
difficult economic environment and am delighted that Crown's investment puts
CCR in a strong a financial position."
Under the terms of the Agreement, CCR will receive a $50 million termination
fee and a $320 million investment into Series B Non-Participating Units,
which have no coupon and are not subject to mandatory redemption.
Separately, as part of the Agreement, CCR has granted Crown an option for
two years to complete its purchase on terms consistent with the original
Merger Agreement if Crown successfully completes its licensing process in
the applicable jurisdictions.
In the event regulatory approvals for the investment are not received within
60 days (or 90 days if CCR elects to extend the period), Crown will not be
issued with the Series B Non-Participating Units. Instead, an additional
fee of $200 million will be paid to CCR from the escrow, and Crown will
invest $40 million into CCR for a 4.1% non-voting stake.
CCR is owned by Millennium Gaming, Inc. (58%), which is a joint venture
between Bill Paulos and Bill Wortman, and entities managed by Oaktree
Capital Management, L.P. through affiliates (42%).
About Cannery Casino Resorts
Cannery Casino Resorts, LLC, owns and operates the Cannery Casino & Hotel in
North Las Vegas; the Rampart Casino within the Resort in Summerlin, also
home of the J.W. Marriott Resort; and Eastside Cannery Casino & Hotel. The
company also owns and operates the Meadows Racetrack & Casino in Washington
County, PA. Cannery Casino Resorts can be reached at (702) 856-5300. The
specific property websites are as follows: Cannery Casino & Hotel and
Eastside Cannery Casino & Hotel, www.cannerycasinos.com; Rampart Casino,
www.rampartcasino.com. The Meadows Racetrack & Casino can be reached at
(724) 503-1200, (877) 824-5050, or by visiting www.meadowsgaming.com.
The Meadows Racetrack & Casino's permanent casino facility is expected to
open in April 2009. Upon its completion, Cannery Casino Resorts will
operate approximately 8,400 slots and 75 table games, and more than 720
hotel rooms throughout its properties.
About Oaktree Capital Management
Oaktree (GSTrUE: OAKTRZ) is a premier global alternative and non-traditional
investment manager with over $49 billion in assets under management as of
December 31, 2008. The firm emphasizes an opportunistic, value-oriented and
risk-controlled approach to investments in distressed debt, high yield and
convertible bonds, specialized private equity (including power
infrastructure), real estate, emerging market and Japanese securities, and
mezzanine finance. Oaktree was founded in 1995 by a group of principals who
have worked together since the mid-1980s. Headquartered in Los Angeles, the
firm today has over 540 employees and offices in 14 cities worldwide.
Contacts
Tom Willer
Cannery Casino Resorts LLC
702-856-5112