Two local entertainment giants are combining their resources.
Coppell-based Dave & Buster’s Entertainment, a publicly traded firm, is set to acquire Dallas’ Main Event Entertainment in an all-cash deal valued at $835 million. The companies call the deal a “transformational opportunity.”
“From a strategic fit perspective, Main Event’s business model, footprint, and asset quality aligns well with Dave & Buster’s,” said Kevin Sheehan, Dave & Buster’s board chair and interim CEO, in a statement. “Ownership of both brands enables us to expand the breadth of customers we serve together, while also enabling each brand to better differentiate its offering to its core consumer.”
Main Event CEO takes the helm
When the deal closes later this year, Main Event CEO Chris Morris will become the CEO of Dave & Buster’s. Before joining Main Event in 2018, Morris served as the president of California Pizza Kitchen. He has also held executive roles at North Texas-based companies On The Border Mexican Grill and the parent company of Chuck E. Cheese. While at Main Event, Morris is credited with expanding the company’s footprint by more than 30% and more than doubling its EBITDA.
Sheehan, who has held the role since last October, will return to his role as the company’s board chair.
Following the deal’s completion, Main Event will continue to operate as a distinct brand under Dave & Buster’s. Sheehan said the move will allow the two brands to expand their customer base—with Main Event focusing on family entertainment and Dave & Buster’s focusing on young adults—while saving around $20 million over the next two years through consolidating store support center services and supply chain operations.
Main Event, which is owned by Ardent Leisure Group and RedBird Capital Partners, operates 50 locations across the country, while Dave & Buster’s has 145 venues across the U.S., Puerto Rico, and Canada. In a financial filing, Dave & Buster’s said it opened five new stores in the last fiscal year and plans a “moderate pace” of new store openings this year.
“Together, we’ll be well positioned to leverage our collective experience and provide our consumers with a category-defining entertainment experience,” Morris said in a statement. “I’m looking forward to enhancing the offerings and experiences of each brand and providing even more opportunity for our team members.”
The move comes just two months after Dave & Busters left its longtime Northwest Dallas headquarters for a new 67,000 square-foot space near DFW International Airport. It also comes as the company, which trades on the Nasdaq under the ticker PLAY, is showing signs of pandemic recovery. In 2021, the nearly 14,000-person company reported $1.3 billion in revenue, just 3.7% less than the $1.35 billion it reported in 2019 and a nearly 200% increase from the $436.5 million it reported in fiscal year 2020.
“Main Event’s existing footprint works well with Dave & Buster’s current geographies and each brand has significant growth opportunities. We expect the acquisition to be accretive to growth and earnings,” Sheehan said.
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