IRVING, TEXAS, and NEW YORK — Apollo is taking a bite, and not just a nibble, into the family entertainment and pizza business. The global alternative investment manager plans to acquire CEC Entertainment, Inc., which operates 577 Chuck E. Cheese’s stores, for about $1.3 billion, including the assumption of CEC’s outstanding debt.
An affiliate of Apollo Global Management, L.L.C. (together with its consolidated subsidiaries, “Apollo”) and CEC announced the definitive merger agreement Jan. 16. Apollo’s all cash offer of $54 per share represents a premium of about 25% over CEC’s closing share price on Jan. 7 and a premium of about 36% over the 12-month volume weighted average share price for the period ended Jan. 7.
“Apollo brings significant industry expertise and financial resources, and we look forward to working with them to further grow CEC domestically and internationally,” said Michael H. Magusiak, president and chief executive officer of Irving-based CEC.CEC and its franchisees operate Chuck E. Cheese’s stores in 47 states and 10 foreign countries or territories. CEC’s share price on the New York Stock Exchange closed at $48.43 on Jan. 15 and was trading at $54.51 late in the morning on Jan. 16.