RCI Hospitality Strengthens Portfolio with Flight Club Acquisition
RCI Hospitality's Latest Acquisition
RCI Hospitality Holdings, Inc. (NASDAQ: RICK) has recently made waves with its announcement of acquiring Flight Club, a notable gentlemen's club in the Detroit area. This acquisition marks an essential milestone for RCI as it continues to expand its reach and reinforce its strategic position in the adult entertainment industry.
Details of the Acquisition
The total purchase price for Flight Club was $11.0 million, comprising a mix of cash and seller financing. RCI is investing $3.0 million in cash, along with $5.0 million in seller financing set at an interest rate of 8.0%. An additional $3.0 million was earmarked for associated real estate. This acquisition is projected to contribute around $2.0 million in annualized adjusted EBITDA, demonstrating its potential for profitable returns.
Insights from RCI's Leadership
Eric Langan, the President and CEO of RCI Hospitality Holdings, expressed enthusiasm about this acquisition, stating, "This is an exciting acquisition that fits well with our other high-end clubs with restaurants in major cities. It represents our first club purchase following the launch of our 'Back to Basics' Capital Allocation Plan. Flight Club is a well-established business that should benefit from our marketing and operational expertise." His remarks underline the company’s strategic approach to expansion and enhancing business operations.
About Flight Club
The Flight Club establishment spans two stories and approximately 10,000 square feet. It is situated conveniently at 29709 Michigan Avenue, featuring upscale entertainment options, including a sports car that dramatically descends from the ceiling. With valet parking, easy freeway access, and a celebrated five-star kitchen, Flight Club highlights the caliber of experience RCI is striving to offer its customers. Open for extended hours throughout the week, it caters to both weekday and weekend patrons.
RCI Hospitality Holdings Overview
RCI Hospitality Holdings, Inc. operates more than 60 venues across the United States, positioning itself as a leader in the adult nightclub and sports bar-restaurant industries. Each of RCI’s brands embodies the company's commitment to quality and customer satisfaction, promising an unforgettable experience for its guests.
Frequently Asked Questions
What prompted RCI Hospitality to acquire Flight Club?
The acquisition aligns with RCI's strategic growth plans under the recently launched 'Back to Basics' Capital Allocation Plan, aiming to expand its portfolio of high-end clubs.
How much did RCI Hospitality pay for Flight Club?
RCI purchased Flight Club for a total of $11.0 million, including cash payments and seller financing.
What are the expected benefits of the acquisition?
RCI anticipates that Flight Club will generate approximately $2.0 million in annualized adjusted EBITDA, augmenting RCI's financial performance.
Who is responsible for RCI Hospitality's expansion efforts?
Eric Langan, President and CEO of RCI Hospitality, plays a pivotal role in driving the company’s growth initiatives and strategic acquisitions.
What types of venues does RCI Hospitality operate?
RCI Hospitality operates a range of adult nightclubs and sports bar-restaurants, focusing on delivering high-quality experiences to its patrons.
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