Dallas and Coppell, Texas — Dave & Buster’s Entertainment Inc. (NASDAQ: PLAY) has agreed to acquire family entertainment concept Main Event for $835 million in an all-cash transaction.
The seller is a joint venture between Ardent Leisure Group Limited and Red Bird Capital Partners, and the deal is expected to close later this year. Chris Morris, current CEO of Main Event, will act as CEO of the combined entity upon closing.
The purchase price represents a valuation of approximately nine times Main Event’s 12-month adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) as of Dec. 31. Deutsche Bank Securities Inc., JPMorgan Chase Bank, N.A. and BMO Capital Markets Corp. are the joint lead arrangers and joint book-runners on the transaction.
“From a strategic fit perspective, Main Event’s business model, footprint and asset quality aligns well with Dave & Buster’s,” says Kevin Sheehan, board chair and interim CEO of the Coppell-based buyer.
“Main Event targets a different demographic — families with younger children — while Dave & Buster’s primarily targets young adults,” he continues. “While each brand will continue to operate independently, ownership of both brands enables us to expand the breadth of customers we serve together, while also enabling each brand to better differentiate its offering to its core consumer.”
Deutsche Bank is serving as financial advisor and Kirkland & Ellis LLP is serving as legal advisor to Dave & Buster’s. Goldman Sachs and J.P. Morgan are serving as financial advisors to Main Event. Weil, Gotshal & Manges LLP is serving as legal advisor to Main Event, and Fried, Frank, Harris, Shriver & Jacobson LLP is serving as legal advisor to RedBird. Gilbert + Tobin is serving as legal advisor to Ardent Leisure.
Founded in 1982, Dave & Buster’s is the owner and operator of 145 locations across 40 states, Puerto Rico and Canada. The concept combines entertainment attractions centered on playing games and watching live sports with a full restaurant and bar. PLAY stock closed at $42.51 per share on Wednesday, April 6, slightly down from $44.78 on the same date last year.
Dallas-based Main Event operates 50 locations across 17 states. The concept includes bowling, laser tag, arcade games and virtual reality attractions, with a focus on providing activities for the entire family.
—Katie Sloan