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Tilman Fertitta wants to take another company public

The owner of Landry’s has formed a second public shell company and is raising $275 million to fund a deal.
Photograph: Shutterstock

Tilman Fertitta is fishing for another deal.

The “Billion Dollar Buyer” and owner of restaurant collector Landry’s is taking public another shell company, raising funds to merge with a company considered undervalued.

Landcadia Holdings II, a “blank check company” sponsored by Fertitta’s Landry’s as well as the investment bank Jefferies, priced its initial public offering earlier this week and plans to raise $275 million by the time the offering closes on Thursday.

Blank check companies take funds raised from such offerings and use them to acquire other businesses. The shell company then merges with the privately-held firm, changes its name to the acquired company’s name, in the process taking the company public.

In 2016, Fertitta and Jefferies worked together on an IPO for Landcadia Holdings, raising $250 million that was later used to acquire the third-party delivery service Waitr, a deal that was complete last November. Waitr then acquired Bite Squad and now trades on the Nasdaq stock exchange, with Fertitta on the board.

Chuck E. Cheese owner CEC Entertainment is going public in this manner, merging with a London-based blank check company called Leo Holdings. Burger King, now part of Restaurant Brands International, and Del Taco both were taken public in this manner.

Fertitta is no stranger to acquisitions. He made more than 20 acquisitions to build Landry’s, acquiring Morton’s The Steakhouse, McCormick & Schmick’s, and numerous other chains, often finding companies at low valuations.

Landry’s owner, Fertitta Entertainment Inc., also owns the Houston Rockets and, according to an SEC filing generated more than $4 billion in revenue last year.

Filings say that Landcadia is targeting a combination in the consumer, dining, hospitality, entertainment, and gaming industries, “including technology companies operating in these industries.”

The filing said the company business models “differentiated” or “disruptive to entrenched competitors.” Landcadia is looking for companies that can grow or make acquisitions, are “underperforming potential peak operational or financial performance capabilities” and has a value proposition “not fully recognized by the market.”

And the company targeted has to have a history of free cash flow generation.

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