K&F advises Bally’s to reject Standard General’s ‘undervalued’ buyout offer

Finance News

K&F Growth Capital, an asset management firm and shareholder of Bally’s Corporation, has publicly recommended that the Special Committee of Bally’s Board of Directors reject an acquisition proposal from Standard General, the company’s largest shareholder. 

K&F saythat Bally’s should stay in its lane and quit wasting money on efforts that aren’t core to its business. 

They insist the company doesn’t know how to build or operate high-end casinos or online sports betting and internet gaming businesses, saying that spending on those projects is what has driven down the share price and market cap. It is also our belief that a U.S. public company should not be in the business of supplying gaming equipment and operations to the Japanese market under the country’s current regulatory framework.

In so doing, we believe there are negative implications to Bally’s access to capital. Bally’s should pursue a sale or structured separation of the International Interactive business as the universe of potential acquirors is expansive (across both strategic and private equity parties).