Apollo Global Management’s $1.96bn acquisition of Great Canadian Gaming approved by shareholders

Shareholders of Great Canadian Gaming Corporation have officially approved the CAD 2.52 billion ($1.96 billion) acquisition bid from Apollo Global Management, a major milestone in one of Canada’s most closely watched private equity deals of the year. The vote, held on December 23, 2020, saw 79.4% of the Canadian casino and entertainment company’s shareholders supporting Apollo’s sweetened offer of CAD 45.00 per share, up from the initial CAD 39.00 bid tabled last month.

The proposed acquisition now moves closer to completion, pending regulatory approvals and other customary closing conditions. If these final steps proceed without delay, the transaction is anticipated to close in the second quarter of 2021.

Why did Apollo increase its offer to acquire Great Canadian Gaming?

The revised proposal comes after significant pressure from several shareholders who had publicly opposed the original offer, claiming it undervalued the Canadian casino operator. Apollo’s initial offer, announced in November, valued the company at CAD 3.3 billion in enterprise value terms, including debt. However, concerns over the fairness of the CAD 39.00 per share valuation led to weeks of discussions between Apollo and investors, eventually resulting in the 15.4% increase to CAD 45.00 per share.

The new bid reflects a deeper confidence in Great Canadian Gaming’s long-term growth potential, particularly as the company looks to rebound from COVID-19 disruptions. Analysts covering the Canadian gaming and hospitality sector have pointed to Apollo’s operational experience in the leisure space as a critical factor in enabling a turnaround. Apollo has managed other gaming assets in the past, including Caesar’s Entertainment and Harrah’s, giving it a reputation for restructuring large entertainment portfolios.

How does the acquisition align with Apollo’s strategy in gaming and leisure?

For Apollo Global Management, the move to acquire Great Canadian Gaming is aligned with its ongoing strategy of acquiring undervalued or underperforming hospitality and entertainment assets with long-term upside. Despite the pandemic’s ongoing impact on brick-and-mortar casinos, Apollo appears to be betting on a post-COVID recovery across the Canadian gaming sector.

Private equity investors have increasingly turned to distressed or recovering sectors, and Great Canadian Gaming presents a compelling opportunity. The company’s diversified footprint—spanning 25 properties in Ontario, British Columbia, Nova Scotia, and New Brunswick—offers exposure to regional tourism and local gaming demand, both of which are expected to recover as vaccine distribution accelerates in 2021.

Great Canadian Gaming’s real estate portfolio, licensing agreements, and exclusivity zones in key Canadian provinces are also seen as valuable long-term assets. Institutional analysts suggest that Apollo’s expertise in optimizing hospitality operations and enhancing non-gaming revenue streams could unlock further value post-acquisition.

What does Great Canadian Gaming bring to the table?

Founded in 1982, Great Canadian Gaming has grown into one of Canada’s most prominent casino and hospitality operators. As of 2020, the company owns and operates 25 gaming, entertainment, and hospitality facilities, making it a dominant force in the Canadian gaming industry. Its venues include well-known properties such as the River Rock Casino Resort in British Columbia and Casino Woodbine in Ontario.

Prior to the pandemic, the Canadian gaming market was on a stable growth trajectory, with Great Canadian Gaming benefiting from strong consumer demand and exclusive operational rights in key regions. The company’s strategic partnerships with provincial gaming authorities, such as the Ontario Lottery and Gaming Corporation (OLG), have allowed it to participate in modernization initiatives—particularly in Ontario, where private operators are increasingly involved in day-to-day casino operations.

However, 2020 proved difficult for the operator. COVID-19 restrictions forced the temporary closure of most gaming properties, leading to sharp declines in revenue and profitability. The prolonged pandemic environment significantly reduced footfall, halted live events, and interrupted hospitality services—adding urgency to the company’s search for a more sustainable financial and operational framework.

How did investors react to the revised Apollo offer?

Investor reaction to the CAD 45.00 per share offer has been largely positive, with several previously dissenting shareholders expressing support following the revision. Institutional voices such as Burgundy Asset Management and BloombergSen Inc., which had earlier raised concerns over valuation and governance issues, indicated greater satisfaction with the increased premium and improved transparency around the deal structure.

The 79.4% shareholder approval—well above the two-thirds threshold required under Canadian corporate law—demonstrates growing confidence that Apollo’s stewardship will provide financial stability and strategic clarity during a volatile period for the gaming sector. Market sentiment reflected this approval, with shares of Great Canadian Gaming closing near the revised offer price, signaling confidence in deal completion.

Equity analysts covering the transaction noted that while the offer represents a compromise between Apollo’s valuation discipline and shareholder demands for fairness, it leaves some upside on the table for a long-term recovery under private ownership.

Will regulatory hurdles delay the acquisition timeline?

Although shareholder approval marks a major milestone, the acquisition is still subject to various regulatory approvals from both provincial and federal authorities in Canada. These include approvals from gaming regulatory bodies in British Columbia and Ontario, as well as a review under the Investment Canada Act, which assesses foreign acquisitions for their net benefit to the country.

Analysts expect that Apollo’s extensive track record of managing gaming assets and its commitment to retaining Canadian jobs and investing in facility upgrades will support a smoother regulatory process. However, timelines for such approvals remain subject to government review and evolving pandemic conditions, particularly if additional public health restrictions are introduced.

Apollo has committed to maintaining Great Canadian Gaming’s existing operations and management teams while investing in its long-term growth. This assurance could help ease regulatory concerns, especially regarding foreign ownership of strategic entertainment infrastructure.

What does this deal mean for the Canadian casino industry?

The acquisition of Great Canadian Gaming by Apollo is likely to accelerate consolidation in Canada’s fragmented casino industry. As private equity capital flows into the sector, smaller operators may find themselves under pressure to merge or scale up in order to remain competitive. With Great Canadian Gaming set to become a private entity, its operational flexibility may increase, enabling more aggressive modernization and expansion strategies without the short-term pressure of quarterly earnings disclosures.

Moreover, the deal underscores a shift in how investors are viewing gaming assets in a post-pandemic world. With digital gaming and online sports betting expanding rapidly, traditional casino operators are being pushed to diversify revenue sources and upgrade digital capabilities. Apollo’s ownership may support investments in these areas, particularly as provincial governments like Ontario explore iGaming initiatives.

For Canadian policymakers and gaming regulators, the transaction may prompt broader reflection on the role of foreign capital and private equity in shaping the future of regulated gaming. As Apollo takes over one of Canada’s most significant gaming companies, questions around domestic control, regulatory oversight, and long-term investment in local communities may take center stage.