Clairvest earns 46 pct IRR with $1.45 bln sale of Rivers Casino


Photo courtesy of Rivers Casino

Canadian mid-market private equity firm Clairvest Group has completed the sale of its stake in Rivers Casino, a Des Plaines, Illinois-based gaming and entertainment complex.

The deal, announced last year, saw Rivers acquired by Churchill Downs Inc at an enterprise value of US$1.45 billion.

Clairvest invested in the company in 2010. Rivers subsequently did two recapitalizations, including a 2016 transaction worth US$600 million.

Clairvest said it realized cash proceeds of about US$135 million from the sale, which when combined with other proceeds received represents 8.4 times invested capital and an internal rate of return of 46 percent.

PRESS RELEASE

Clairvest Realizes a Return of 8.4x on its Investment in Rivers Casino

TORONTO, March 05, 2019 (GLOBE NEWSWIRE) — Further to a statement released on October 31, 2018, Clairvest Group Inc. (TSX: CVG) today announced that it and Clairvest Equity Partners IV (collectively “Clairvest”) have completed a transaction whereby Clairvest’s interest in the Rivers Casino (“Rivers” or the “Company”) was acquired by Churchill Downs Inc. at an enterprise value of US$1.45 billion.

Clairvest made its investment into Rivers in partnership with Rush Street Gaming and statutory minority investors in 2010. The business opened in July 2011 and has become the leading casino in the State of Illinois. The financial success of Rivers Casino has allowed it to complete two material recapitalizations that allowed investors to repatriate 4.3 times their investment before tax, during the first 6 years of the company’s operations.

Upon completion of the transaction, Clairvest realized cash proceeds of approximately US$135 million, which when combined with cash proceeds received to date, represents 8.4 times invested capital over the 9-year investment period, and an IRR of 46%. The completion of this transaction is expected to increase Clairvest’s book value per share by approximately $0.58 per share from the reported December 31, 2018 book value per share of $49.65 per share.

“From the time Rivers opened its doors, it was clear that it would be a tremendous success. Rivers’ entertainment offering and outstanding management team at Rush Street Gaming made Rivers one of the most successful casino properties in the United States,” noted Jeff Parr, Vice Chairman and Managing Director of Clairvest. “The financial success of our investment in Rivers is a result of Clairvest’s expertise in the gaming industry, now covering 32 gaming assets globally across 17 years. We have a unique view of the industry which allows us to uncover successful investment opportunities such as Rivers. We are very proud of this outcome and look forward to working with the Rush Street team on other gaming projects in the future,” added Mr. Parr.

About Clairvest
Clairvest Group Inc. is a private equity management firm that invests its own capital, and that of third parties through the Clairvest Equity Partners limited partnerships, in businesses that have the potential to generate superior returns. In addition to providing financing, Clairvest contributes strategic expertise and execution ability to support the growth and development of its investee partners. Clairvest realizes value through investment returns and the eventual disposition of its investments.

Clairvest Contact Information

Maria Shkolnik
Director, Investor Relations and Marketing
Clairvest Group Inc.
Tel: (416) 925-9270
Fax: (416) 925-5753
[email protected]

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