Was Revel Just Acquired?

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A FTC filing on January 13 shows a purchase by one of Revel’s existing investors, Welsh Carson, of some amount of Revel.

It’s possible that it’s another investment by the PE firm, but Welsh Carson is mostly known as a buyout firm. From their site:

WCAS believes that our value-added investment strategy is best executed when we acquire operational and strategic control of companies. Since 1995, approximately 90% of WCAS equity capital has been invested as a control investor. Private equity transactions occasionally involve consortium deals with multiple buyout firms. WCAS generally avoids participating in club deals or consortium investments. To take advantage of larger opportunities, WCAS secures additional co-investments from our Limited Partners. Over the last three Equity Partnerships and WCAS CP IV, Limited Partner co-investment opportunities totaled $3 billion of invested capital in 11 transactions.

For further confirmation something interesting is happening, check out Revel’s pitchbook profile. Screenshot below.

I’m suspect of profitability… they have between 500 and 1,000 employees. At a fully-weighted employee cost of $100K per year (it also makes math easy), they would need to be earning at least $50MM in annual revenue to be profitable. If that were the case, a $500MM valuation would be pretty easy considering private money has been generous to valuing companies at 10x revenues.

According to Revel’s Wikipedia page, which I assume someone from the company manages, they list 750 employees. You get where this is going…

Revel has declined to comment at this time. However it’s not a good sign if Revel was indeed acquired for $500MM if they were worth “just north of $500MM” in August of 2015.

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