- Ardent Leisure (ALG) has entered into foreign currency (FX) hedges to provide certainty over its US$485 million (A$682 million) sale proceeds
- The proceeds relate to sale of Ardent’s Main Event entertainment arm to Dave & Buster’s Entertainment
- ALG notes its obligations under the FX Hedges to deliver USD proceeds only arise either when the Main Event sale is complete or upon completion of a change of control of Ardent Leisure itself
- ALG shares have been trading 0.79 per cent in the red at $1.26
Ardent Leisure (ALG) has entered into foreign currency (FX) hedges to provide certainty over sale proceeds from a recently announced sale agreement.
On April 6, the company entered a binding agreement and plan of merger to sell its Main Event business to Dave & Buster’s Entertainment for US$487 million (A$686.2 million).
The FX hedges provides certainty over US$485 million of the sale proceeds.
Assuming completion of sale by April 2023, these FX hedges will provide proceeds of at least A$664.5 million.
The company noted that its obligations under the FX Hedges to deliver USD proceeds only arise either upon completion of the Main Event sale occurring or upon completion of a change of control of Ardent Leisure itself.
The sale will require shareholder approval at an extraordinary general meeting to be held later this year but the Board has unanimously agreed to the deal.
Under the proposed sale, Ardent Leisure will receive about US$487 million in cash proceeds, majority of which will be returned to Ardent Leisure shareholders at 90 cents a share.
The Main Event business comprises 50 entertainment centres spread across the US.
If approved, the deal will transform Ardent, who owns Dreamworld on the Gold Coast and other struggling theme parks, into an Australian-only business.
ALG shares were trading 0.79 per cent in the red trading at $1.26 at 3:52 pm AEST.