2/16/2010-In a deal that creates the largest publicly traded gentlemen's club operator, Rick's Cabaret (NASDAQ:RICK) announced it has entered into a definitive agreement to acquire VCG Holding Corp. (NASDAQ:VCGH) in an all-stock deal that values VCG shares between $2.20 and $3.30 per share.
Terms of the transaction, dictate the following, "VCG Holding's shareholders will receive shares of Rick's common stock based on certain exchange ratios valuing each share of VCG Holding's common stock between $2.20 and $3.80 per share, determined based on the weighted average closing price of Rick's common stock as traded on the Nasdaq Global Market for the 20 consecutive trading days ending on the second trading day prior to the closing of the Merger."
Eric Langan, President and CEO of Rick's Cabaret International, said: "The combination of these two companies will result in a powerful operator that we believe would have generated earnings before income tax and depreciation (EBITDA) for the 12 months ended September 30, 2009 of approximately $25.3 million without any of the add-backs we anticipate we will achieve through synergistic cost savings. I am confident that the combined entities can achieve meaningful savings through streamlined management and elimination of duplicate costs associated with being two separate public companies, including lower legal and accounting expenses."
The two companies combined would have generated revenues of $131.3 million for the 12 month period ending September 30, 2009.
Keywords: Rick's Cabaret VCG Holding acquisition buyout merger
