Posted on: May 9, 2023 2:49 am.
Last updated on: May 9, 2023 02:49 am.
Bally’s (NYSE: BALY) has confidentially filed an S-1 with the Securities and Exchange Commission (IPO) for an initial public offering (IPO) of shares in its proposed Chicago casino.
Bally’s Atlantic City. The operator will sell a 25% stake in its Chicago casino to select local investors. (Image: ` News)
The offer relates to the host community agreement reached between the gaming company and the city, for the sale of shares in the integrated resort to select Chicagoans.
The number of ownership shares to be offered, their terms and the price range for the proposed offering have not yet been determined. The IPO is expected to occur after the SEC completes its review process, subject to market and other conditions,” Rhode Island-based Bally’s said in a statement.
The size of the proposed bid and other financial terms were not disclosed. The $1.7 billion casino hotel will be Bally’s first within Chicago city limits and its most expensive project to date.
Bally wants to generate goodwill in the Chicago community
Outgoing Mayor Lori Lightfoot (D) approved Bally’s plan to bring a casino to the US’s third largest city, and the concept was not without controversy.
One way for Bally’s to allay local concerns about a new venue is to show it actively plans to be a good steward in the community. This includes giving selected local people the opportunity to participate in the potential economic benefits of the integrated resort.
While details on eligibility to participate in the Chicago casino offering are scarce at this time, it is widely expected that Bally’s will target minority investors, among others. On the operator’s first-quarter earnings conference call today, outgoing CFO Robert Lavan told analysts he couldn’t go into detail about the Chicago IPO.
The gaming company will sell up to a 25% stake in the project to investors including “philanthropists, business owners, sports stars, celebrities and everyday Chicagoans from the Black and Hispanic communities, as well as other ethnic and gender-balanced representatives,” according to Bally’s. Website.
Bally’s Chicago Casino wants to help small businesses
A common refrain from casino opponents is that new gaming venues will hurt, not help, small local businesses. In Chicago, Bally’s is trying to allay those concerns by using its customer loyalty platform to support small businesses in the area – a tactic other operators are trying in other cities.
“The casino offers a viable rewards program and local Chicago businesses benefit from the patronage generated by the program. It should be noted that award redemption is not the only benefit. Additional promotion and awareness will be generated and built around the customer base,” the host community agreement reads. “This is an expense the small company could not afford alone and now they face thousands of Bally’s customers.”
As for the readiness of the venue and an upcoming temporary casino at Medinah Temple, Bally said it is on schedule and on budget.
“We look forward to opening the temporary Chicago casino in late summer 2023, which is on track and on budget. We are also advancing full construction of our permanent Bally facility in Chicago, which is slightly ahead of schedule and budget for opening in summer 2026,” Bally’s President George Papanier said in a statement.
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