A Boutique Investment Bank with One, Unique Focus Q3 2018

Transcription

1 A Boutique Investment Bank with One, Unique Focus Q3 2018

2 Union Gaming A Boutique Investment Bank with One, Unique Focus Union Gaming is a boutique investment bank and advisory firm focused exclusively on the global gaming industry, which we define as the $500 billion plus market to include land based casinos, lottery, online, and pari-mutuel wagering. The company specializes in global equity research, corporate finance and broking, capital markets, and advisory. Founded in 2009, the company has offices in Hong Kong, Las Vegas, and Macau. Union Gaming Securities is an SEC and FINRA member firm in the United States, and a Type 1, 4, and 6 licensed corporation with the Securities and Futures Commission (SFC) in Hong Kong. Union Gaming Analytics is an advisory firm and affiliate of Union Gaming Securities. The company conducts gaming market studies and feasibility studies for corporate and government entities, as well as RFP submissions and development advisory for greenfield gaming projects globally. Vision Union Gaming was launched in 2009 based on the recognition that A large opportunity existed to build a sustainable boutique investment bank focused exclusively on the global gaming industry Thought-provoking research would always have a place irrespective of changes in the global regulatory framework Over time the model would evolve from a traditional brokerage business to an advisory and capital markets firm Big bank coverage applied to small and medium-sized companies would be a high return business Union Gaming Analytics would nicely complement the banking franchise, at the same time disrupting the highly fragmented incumbents Milestones 2009 Company formation in Las Vegas, Nevada 2010 FINRA & SEC membership 2011 Opening of Macau office 2013 Formal launch of Union Gaming Analytics led by longtime industry veteran, Richard Baldwin 2014 Opening of Hong Kong office 2015 Securities and Futures Commission (SFC) Type 1, 4, and 6 licensed corporation in Hong Kong 2016 Official launch of Asia corporate finance business Page 2

3 The Union Gaming Edge What Differentiates Us From Our Competitors Single Sector Focused Advantaged versus generalist competitors Deep domain expertise Specialist distribution and capital markets team Fluency across the capital structure Largest universe of equity research across gaming operators and gaming technology companies Strategic Locations Equity Research teams based in largest gaming markets Capital Markets teams based in global money centers Team Diversity Unique mix of corporate finance and industry professionals Globally distributed across North America and Asia Large Sphere of Influence Management Teams Regulators Industry Stakeholders Investors Enviable Client Base Corporates listed and private companies Institutions mutual funds, hedge funds, sovereign wealth, and family offices Governments, real estate groups, and trade associations Quality People Content Compliance Revenues Page 3

4 Seasoned Leadership Team With Extensive Wall Street & Industry Experience Bill Lerner Principal, Managing Director Head of Investment Banking, Las Vegas Co-founded Union Gaming in 2009 Including Union Gaming, spent 21 years on Wall Street in sell-side research at Deutsche Bank and Prudential Leads Union Gaming s global investment banking practice Rich Moriarty Principal, Managing Director Global Head of Distribution, Hong Kong Co-founded Union Gaming in 2009 Including Union Gaming, spent 20 years on Wall Street in specialty sales and distribution roles at Deutsche Bank and Lehman Brothers Leads Union Gaming s global distribution business Grant Govertsen Principal, Managing Director Head of Asia Research, Macau Co-founded Union Gaming in 2009 Prior to Union Gaming, spent 12 years on Wall Street in sell-side research at Deutsche Bank Leads Union Gaming s Asia research effort Mike Glynn Managing Director Chief Operating Officer, New York Joined Union Gaming in 2012 to oversee the firm s global risk, operations and compliance efforts Spent 20 years on Wall Street with various leadership roles Most recently Chief Compliance Officer of Topeka Capital Markets, Director of Operations at Kellogg Partners Also held leadership positions at Spear, Leeds & Kellogg, Fleet Securities and Morgan Stanley Rich Baldwin Managing Director Investment Banking Co-Head of Union Gaming Analytics, Las Vegas Joined Union Gaming in years experience in corporate finance, M&A, investor relations and general operational management spanning the global gaming industry Prior to joining Union Gaming, CFO of Tropicana Entertainment; EVP & CFO of Shuffle Master Gaming; Director of Corporate Finance & Investor Relations at International Game Technology and Anchor Gaming Bill Allsup Director Co-Head of Union Gaming Analytics, Las Vegas Joined Union Gaming in 2014 Spent 10 years in corporate finance, business development and investor relations in the gaming industry Most recently Senior Financial Analyst at Anchor Gaming; Senior Financial Analyst at International Game Technology & Controller at Aristocrat Technologies, Inc. Jack Hernandez Director Head of Structured and Leveraged Finance, Hong Kong Joined Union Gaming in 2016 Spent 10 years with Deutsche Bank in investment banking in both New York and Hong Kong Spent 3 years in Structured Finance in Hong Kong covering geographies such as Macau, India and Southeast Asia Prior to Hong Kong, spent 7 years in Leveraged Financed in New York focusing on the gaming, lodging and leisure industry Kyle Lim Vice President Investment Banking, Las Vegas Joined Union Gaming in 2017 after spending 10 years on Wall Street Prior to joining Union Gaming, worked as an investment banking and corporate development professional at Three Keys Capital, Cowen & Company, Guardian Life and UBS providing corporate advisory services to financial services and technology companies John DeCree Director Head of Americas Research, New York Joined Union Gaming in 2014 to lead the Americas High Yield and Equity research effort Spent 10 years in capital markets focusing on the casino and gaming industry Prior to Union Gaming, served as equity research analyst at Telsey Advisory Group covering the global gaming, lodging and leisure sectors Prior to Telsey, spent 5 years in leveraged finance at the GMS Group focusing on the global gaming industry Page 4

5 Union Gaming Securities Business Overview Equity Research & Distribution Investment Banking Single Stock Company and Industry Macro Research High frequency of published research providing fundamental analysis and proprietary insight on the largest universe of gaming companies; identifying key issues and evolving trends in existing and emerging gaming markets. Jurisdictional Analysis, Revenue Trends and Forecasts Detailed historical gaming and non-gaming revenue and visitation datasets. Corporate Access Providing turnkey logistics to bring professional investors and corporate issuers together in unique settings ranging from global conferences, nondeal roadshows (NDRs), conference calls, and bespoke field trips. Equity Financing Providing equity capital market solutions to our issuer clients. Our global distribution allows our teams to effectively target and complete transactions in rapidly changing market environments. Debt Financing Our experience as an arranger or documentation agent aligns us with our issuer clients as the industry stamp of credibility when executing a transaction. Private Placement We have one of the industry s most effective global distribution platforms for private placements, allowing us to structure, negotiate, and rapidly complete private transactions for our clients. Strategic Advice Whether it be development advisory, RFP advice, or optimizing the value of a business, the team at Union Gaming is highly focused on working alongside our companies regardless of any transaction opportunity. Corporate Broking Our global team provides ongoing advice to our corporate clients across investor relations, corporate finance, and fund raising. Our goal is to provide our issuer clients with the best possible bespoke advice, and access to the highest quality institutional investors and global markets. Page 5

6 Union Gaming The corporate broker of choice for gaming clients Engage existing and potentially new shareholders via roadshows, capital market investor days, and site visits in key investor locations Union Gaming has long standing relationships with the key institutions covering the sector Allows us to deliver thought leading institutions to a company s shareholder register Leverage deep relationships with institutional thought leaders IR events & corporate roadshows A full-service partnership with our clients Become the initial sounding board for any strategic or operational initiatives being contemplated The eyes and ears of our clients in the market Corporate Broking Thorough analysis of valuation benchmarking and capital structure advice Advice around strategic options including identification and introductions to potential partners and acquisition targets Bespoke special projects Non-transactional corporate finance advice Frequent market updates Equity story positioning Our deep knowledge of the gaming sector allows us to help our corporate clients position their investment case to achieve maximum impact We provide ongoing advice to our corporate clients on the state of market conditions Our expertise allows us to drill down into the specific parameters that impact gaming companies Page 6

7 Union Gaming Analytics Business Overview Gaming Market Studies Market Studies In-depth market and property studies of all gaming jurisdictions worldwide, including market revenue projections and the impact of new supply. Feasibility Studies Deep dive analysis of the viability of a proposed gaming project or property-level expansion including revenue, cash flow and return on investment projections. Economic Impact Economic impact analysis of greenfield developments, property expansions and new gaming markets in the communities in which they operate. Financial Suitability Analysis of balance sheets, sources and uses of cash and liquidity relative to project scope for gaming license applicants. Strategic Planning Development Services Site selection and control, operator vetting/selection, strategic advising on securing partnerships and alliances. Approval Process Coordination and completion of state-issued RFPs. Applicant Evaluation Evaluation and vetting of applicants and application, including financial suitability, development expertise, and operating capability, on behalf of governments and regulatory bodies. Expert Testimony Legislative Support Presenting to governmental, legislative and regulatory bodies to better understand the financial and market impact of proposed gaming legislation. Policy Guidance Strategic advising on rule and regulations, coordination of efforts with law enforcement and other agencies for suitability investigations, coordination with state/local boards and commissions. Page 7

8 Evolution of Union Gaming into a Diversified Platform Revenue By Business % Cash Equities 23% Advisory & Capital Markets 16% Cash Equities 23% Advisory & Capital Markets 62% Cash Equities 73% Advisory & Capital Markets Revenue By Region % Asia Pacific 22% Asia Pacific 100% Americas 93% Americas 76% Americas Page 8

9 Appendices Global Research Coverage Select Global Cash Equity Client Base Select Capital Markets Transactions Select Advisory Transactions Select Union Gaming Analytics Client Base Page 9

10 Global Research Coverage Largest Universe of Equity Research Across Gaming Operators and Gaming Technology Companies Gaming Subsector Name Ticker Price Target Currency Rating Analyst Las Vegas Sands LVS $88 USD BUY DeCree Las Vegas Strip MGM Resorts International MGM $43 USD BUY DeCree Wynn Resorts WYNN $202 USD BUY DeCree Galaxy Entertainment Group 27.HK $84 HKD BUY Govertsen Melco Resorts & Entertainment MLCO $35 USD BUY Govertsen Macau Concessionaires MGM China Holdings 2282.HK $27 HKD BUY Govertsen Sands China 1928.HK $55 HKD BUY Govertsen SJM Holdings 880.HK $10.50 HKD HOLD Govertsen Wynn Macau 1128.HK $31 HKD BUY Govertsen Japan / Pachinko Dynam Japan Holdings Co., Ltd HK $12 HKD HOLD Govertsen Singapore Genting Singapore GENS.SP $1.50 SGD BUY Govertsen NagaCorp 3918.HK $10 HKD BUY Govertsen Frontier Markets Summit Ascent Holdings Limited 102.HK $1.05 HKD HOLD Govertsen Delta Corp Limited DELTA-IN $350 INR BUY Govertsen Penn National Gaming PENN $36 USD HOLD DeCree Pinnacle Entertainment PNK $30 USD BUY DeCree U.S. Regionals Eldorado Resorts ERI $50 USD BUY DeCree Monarch Casino & Resort MCRI $53 USD BUY DeCree Century Casinos CNTY $11.50 USD BUY DeCree Boyd Gaming Corporation BYD $40 USD BUY DeCree Las Vegas Locals Golden Entertainment GDEN $40 USD BUY DeCree Red Rock Resorts RRR $34 USD HOLD Decree Casino REITs Gaming & Leisure Properties, Inc GLPI $40 USD BUY DeCree MGM Growth Properties MGP $32 USD BUY DeCree VICI Properties Inc. VICI $25 USD BUY DeCree International Game Technology IGT $33 USD BUY DeCree Gaming Equipment & Technology PlayAGS AGS $35 USD BUY DeCree Scientific Games Corporation SGMS $59 USD BUY DeCree As of August Page 10

11 Select Global Cash Equities Client Base Well Established Relationships with the World's Largest Gaming Investors Plain Vanilla Hedge Fund Sovereign Mutual Fund Pension Fund Insurance Company Family Office Multi-Strategy Event Driven / Special Situations Corporate Credit Real Estate Canada Singapore MENA Europe Page 11

12 Select Union Gaming Transactions Capital Markets and M&A with Nearly USD $9 Billion in Transactions $185 million $950 million $101 million $12 million Up to $53 million $100 million Secondary Public Offering Primary & Secondary Offering Secondary Public Offering Registered Direct Equity Offering Exclusive Placing Agent Sale of Trans World Corp. to Far East Consortium Int l Exclusive Sell-Side Advisor Debt Financing Sole Arranger August 2018 June 2018 May 2018 March 2018 March 2018 February 2018 $1.39 billion Initial Public Offering February 2018 $189 million Initial Public Offering February 2018 $209million Secondary Offering January 2018 $32 million Follow-On November 2017 $405 million Follow-On September 2017 $21 million Sale of DEQ to Scientific Games Exclusive Sell-Side January 2017 $600 million Notes October 2016 $123 million Top Up Placement Joint Bookrunner September 2016 Savan Vegas Hotel, Laos Exclusive Buy-Side Advisor September 2016 $1.05 billion $341 million Undisclosed Initial Public Offering April 2016 z Merger with Lakes Entertainment Buy-Side Advisor August 2015 Sale of Gold Strike Casino Sell-Side Advisor April 2015 Undisclosed Sale of Railroad Pass Casino Sell-Side Advisor $168 million Bank Debt Financing Exclusive $300 million Block Transaction Sole Placing Agent $65 million Sale of Dania Jai Alai Joint Sell-Side Advisor $1.5 billion Initial Public Offering Joint-Lead Manager $1.15 billion Follow On April 2015 December 2014 February 2014 May 2013 May 2012 May Page 12

13 Select Advisory Transactions Bellwether for Independent Advisory Services to the Gaming Industry Board Advisor Fairness Opinion Fairness Opinion Fairness Opinion Present Present Present July 2018 April 2018 April 2018 Development Advisor Fairness Opinion February 2018 June 2017 June August Massachusetts Casino Project Sale of Oxford Casino Fairness Opinion South Korea Development Advisor Spain Development Advisor 2012 to to to to Page 13

14 Union Gaming Analytics Select Client Base A Business Devoted to Advancing Gaming Initiatives Globally Page 14