Great Canadian Gaming Corp.B次元官网网址檚 chief executive officer faced a barrage of questions Wednesday from some of its minority shareholders who oppose the casino operatorB次元官网网址檚 acceptance of a $3.3 billion takeover announced the previous evening.

Apollo Global Management Inc. has agreed to pay $39 per share for the company B次元官网网址� a price thatB次元官网网址檚 about 35 per cent above Great CanadianB次元官网网址檚 recent value but well short of what some investment managers argue it is worth.

Great Canadian CEO Rod Baker, who has led the company for about a decade, said its independent directors had done a thorough job of analyzing ApolloB次元官网网址檚 offer but acknowledged they hadnB次元官网网址檛 approached other potential investors before unanimously recommending the deal.

B次元官网网址淭his is a very, very strong offer and reflects, we think, all of the potential of the business B次元官网网址� factoring in whatB次元官网网址檚 going to be a very difficult and uncertain period for some amount of time,B次元官网网址� Baker said.

Great Canadian Gaming stock ended the day at $38.90, up $9.99 or nearly 35 per cent. It was the stockB次元官网网址檚 highest close since early March, a few days before the World Health Organization declared COVID-19 had become a pandemic.

The company runs 25 gaming, entertainment and hospitality facilities, primarily in Ontario and British Columbia, but has suspended most of its operations because of COVID-19-related public health restrictions.

Apollo said in its announcement that Great Canadian would remain headquartered in Toronto, led by a Canadian management team, but Baker said neither he nor his team has had any communications with the U.S. firm.

Earlier Wednesday, the company reported a $49-million net loss for the three months ended Sept. 30, of which $36.5 million or 66 cents per share are attributable to its common shareholders.

Revenue dropped 87 per cent from a year earlier to $43.1 million from $341.1 million and cash generated by Great CanadianB次元官网网址檚 operating activities shrank to $27.6 million from $99.5 million a year earlier.

Despite the impact of more than six months of reduced activity since the COVID-19 pandemic hit Canada early this year, Baker said Great Canadian can operate on a reduced level without Apollo but he recommends shareholders accept its offer.

He was criticized during the call by Bloombergsen Investment Partners, a Toronto-based investment firm that owns about 14 per cent of Great CanadianB次元官网网址檚 equity.

According to financial data firm Refinitiv, Bloombergsen is one of Great CanadianB次元官网网址檚 largest minority shareholders and Great Canadian is one of BloombersenB次元官网网址檚 largest holdings in a portfolio worth about US$1.1 billion as of Aug. 31.

B次元官网网址淭his is a terrible and ridiculous deal,B次元官网网址� said Sanjay Sen, president and co-founder of Bloombergsen.

B次元官网网址淲e will vote against this transaction. The equity value of the business has not been hurt, (it) isnB次元官网网址檛 burning much cash, weB次元官网网址檝e turned the corner (on COVID) B次元官网网址� (and) the U.S. regional casinos that are open are earning more money today than they were a year ago,B次元官网网址� Sen said.

Baker said he recognized that Sen was upset but assured him the Apollo deal is in the best interest for shareholders and said Sen should understand that Great CanadianB次元官网网址檚 future growth may not be as strong as it has been in the past.

B次元官网网址淭his is not a sell-out on the cheap to some Americans,B次元官网网址� Baker said.

B次元官网网址淲e donB次元官网网址檛 have to do this deal but this deal is being brought forward because itB次元官网网址檚 the absolute right thing for our shareholders. And, frankly, you and the others should take this.B次元官网网址�

With no majority or controlling shareholder, Bloombergsen wouldnB次元官网网址檛 have enough votes to block the deal at a shareholder meeting to be held in December.

However, minority shareholder groups can sometimes combine forces to push for better terms or to block deals they oppose.

Representatives of two U.S.-based minority shareholders, Madison Avenue Partners and Breach Inlet Capital investors, said on the call that they would also vote against the Apollo deal.

Among other things, the investors said Great Canadian should have looked for alternatives to the Apollo offer, which was announced late Tuesday ahead of the companyB次元官网网址檚 scheduled third-quarter financial report issued Wednesday.

David Paddon, The Canadian Press

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