James Harden’s trade demands are not even the biggest problem for Houston Rockets owner Tilman Fertitta.
Fertitta, 63, told CNBC last month that he planned to list a minority stake of his Golden Nugget restaurant and casino franchise on a public stock exchange but the billionaire’s IPO attempt is not being received well on Wall Street because of a $4 billion debt and low sales, the New York Post reported.
Efforts to raise private funds last year failed, the Post said, reporting that he shopped a 49% stake for a business that includes five casinos and 600 restaurants, including Morton’s Steakhouse, McCormick and Schmick’s, Del Frisco’s, Landry’s Seafood, and Bubba Gump Shrimp.
“I don’t think the public markets will accommodate him,” a banking source who worked on Fertitta fundraising told The Post. “I think Waitr hurt him.”
Waitr, his food delivery service, has dropped from $12 per share at the time he bought it for $308 million in 2018 to $2.78 per share at the close of 2020.
Much of the Golden Nugget’s $4 billion debt came from 2017 financing for a $1.4 billion dividend when the Texan bought the Rockets for $2.2 billion, which was about $550,000 more than its Forbes valuation.
His sports toy, the Rockets, is faring no better than the restaurant business. Ticket sales have been non-existent during the pandemic and he reportedly has considered cutting the team payroll because the Rockets are expected to lose $100 million to $120 million without fans, a banking source told The Post.
“I’ve listened to bankers, and they’ve said some very intriguing things,” Fertitta told CNBC last month.
It might not have been the right bankers.