Written by :
Published on :
LAS VEGAS (Associated Press) — Bally Technologies said Tuesday that it has agreed to buy fellow gambling equipment maker SHFL Entertainment for about $1.3 billion in cash.
SHFL shares shot up up 21.6% in trading on Tuesday, and Bally's shares were up 6.3%.
Bally says the addition of SHFL will complement its existing product portfolio, while also providing new access to land-based and online table games markets around the world.
Under the terms of the agreement, Bally will pay $23.25 per share for the company, which represents a 20% premium over SHFL's Monday closing stock price.
Komlossy Law, P.A. issued a press release Tuesday saying it was investigating SHFL's board of directors for possible breaches of fiduciary duty and Florida state laws. The press release said the law firm was investigating whether the board failed to "adequately shop" the company before the deal.
Bally, originally founded as a pinball machine maker in Chicago, started making slot machines in 1936. It now designs, manufactures and distributes technology-based gambling devices and systems. The company also provides casinos with a variety of marketing, data management, accounting, player tracking, security and other software applications and tools.
SHFL, known for its automatic card shufflers, makes a variety of casino equipment, along with proprietary table, electronic table and online games.
Both companies are based in Las Vegas.
Tuesday's deal also includes debt of $8 million and cash of $41 million as of April 30. Bally said it expects the acquisition to eventually result cost savings of at least $30 million.
The deal, which remains subject to SHFL shareholders approval, is expected to close by the second quarter of calendar year 2014.
