Z Capital Starts Talks to Acquire Remaining Shares of Affinity

  • Private equity firm boosts offer to $15 a share from $14.50
  • Distressed-company investor also owns some Affinity debt

Z Capital Partners is in exclusive talks to buy the outstanding shares of casino operator Affinity Gaming for more than $180 million.

The private equity firm raised its offer for the 59.6 percent of Affinity it doesn’t already own to $15 a share from $14.50, according to a filing Friday with the U.S. Securities and Exchange Commission. Since buying a 25 percent stake in the Las Vegas-based company in 2012, Z Capital has slowly boosted its ownership to 40.4 percent.

Affinity operates 11 casinos in four states. Formerly known as Herbst Gaming, it was renamed in 2011 after emerging from bankruptcy the previous year. Z Capital owns 8.2 million of Affinity’s 20.4 million common shares, which do not trade publicly.

Overseeing $2.3 billion of clients’ capital, the New York-based private equity firm invests in companies that are financially troubled or need money to grow. In addition to its equity stake, Z Capital owns some of Affinity’s $363 million of long-term debt.

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