Chuck E. Cheese's Public Trading Status Explained

Chuck E. Cheese's parent company, CEC Entertainment, has had a tumultuous relationship with the stock market. The company first went public in 1981, but filed for bankruptcy in 1984. After being acquired and merged with competitor ShowBiz Pizza Place, the new parent company, ShowBiz Pizza Time, became a public company in 1989. In 1998, the company changed its name to CEC Entertainment and moved its stock to the NYSE. However, in 2014, CEC Entertainment was taken private again by Apollo Global Management. Five years later, in 2019, the company once again announced plans to go public through a merger with Leo Holdings Corporation, a special purpose acquisition company. This deal, however, fell through, and CEC Entertainment remained private.

Chuck E. Cheese's parent company CEC Entertainment will be publicly traded on the New York Stock Exchange

Chuck E. Cheese's parent company, CEC Entertainment, will be publicly traded on the New York Stock Exchange (NYSE). This follows a merger with publicly-traded Leo Holdings, a special purpose acquisition company (SPAC). The combined company will trade under the CEC symbol on the NYSE. The deal, expected to close in the second quarter of 2019, marks the first time a restaurant company has entered the public market in four years.

CEC Entertainment, which owns the Chuck E. Cheese and Peter Piper Pizza brands, has made significant investments in its menu, stores, and entertainment over the past five years as a private company. These improvements have included replacing tokens with RFID cards and introducing an “all you can play” model that lets parents pay for entertainment by time. The company has also launched a loyalty program and partnerships with delivery platforms. As a result, sales at CEC stores open at least a year grew by 3.3% in the fourth quarter of 2018 and are projected to grow by 7.7% in the first quarter of 2019.

The merger with Leo Holdings will provide CEC Entertainment with $300 million in cash to pay down its debt. Excluding capital lease and sale-leaseback obligations, CEC Entertainment had $978.9 million in outstanding debt as of December 30, 2018, according to company filings.

Following the merger, Queso Holdings, which owns CEC Entertainment, will trade on the NYSE with the ticker CEC. Leo Holdings will change its name to Chuck E. Cheese Brands, and CEC Entertainment will be its subsidiary. Apollo Global Management, which bought Chuck E. Cheese's parent company in 2014 for about $948 million, will remain CEC Entertainment's largest shareholder, retaining a 51% stake in the newly formed company.

The company believes that CEC Entertainment will have an enterprise value of $1.4 billion. In fiscal 2018, the company reported net sales of $896 million across its 750 venues. More than half of its revenue comes from entertainment and merchandise, with the remaining 45% from food and beverage.

The CEO of CEC Entertainment, Tom Leverton, said that the company's executive management team would remain in place after the merger. He also stated that the company would continue to aggressively pursue opportunities, including remodelling stores, introducing new products, and expanding internationally.

The ticker symbol will be CEC

The ticker symbol CEC has been used before by Chuck E. Cheese's parent company. Formerly known as ShowBiz Pizza Time, Inc., the company first went public in 1989 on Nasdaq with the ticker symbol SHBZ. In 1998, the company changed its name to CEC Entertainment, Inc. and moved its stock to the NYSE with the ticker symbol CEC.

The decision to use the ticker symbol CEC again in 2019 was likely influenced by the fact that CEC Entertainment was still the name of the parent company of Chuck E. Cheese at the time of the merger. The merger with Leo Holdings, which was founded by executives of Lion Capital, was expected to result in an enterprise value of $1.4 billion for CEC Entertainment.

The CEC ticker symbol is also a convenient reference to the main character and mascot of Chuck E. Cheese, who is a mouse (formerly a rat). The name of the company's main character is also Chuck E. Cheese, and the company's name is derived from him.

The deal was expected to close in the second quarter of 2019

Chuck E. Cheese's parent company, CEC Entertainment, was expected to go public on the New York Stock Exchange in the second quarter of 2019. This move would mark the company's return to the stock market after being taken private by Apollo Global Management in 2014 for approximately $948 million. The deal involved a merger with a special purpose acquisition company (SPAC) called Leo Holdings, which had no assets but provided the funds for the IPO and acquisition.

The combined company, to be called Chuck E. Cheese Brands Inc., would trade under the ticker symbol "CEC". The deal was expected to provide several benefits. Firstly, it aimed to reduce CEC Entertainment's debt, which stood at $978.9 million in outstanding debt as of December 30, 2018, excluding capital lease and sale-leaseback obligations. Secondly, it would allow CEC Entertainment to focus on investing in its business, such as introducing parent-friendly games and revamping its menu.

The expected closing of the deal in the second quarter of 2019 was an important milestone, as it would mark the return of Chuck E. Cheese's parent company to the public market after five years. This move was seen as a significant step in the company's evolution, allowing it to pursue aggressive growth opportunities, including remodelling stores, introducing new products, and expanding internationally.

The deal highlighted the resilience of the Chuck E. Cheese brand, often described as ""a part of Americana," and its ability to perform well even during economic downturns. The company's leadership team was expected to remain in place, providing stability and continuity to the business.

The second quarter of 2019 was chosen as the expected timeframe for the deal's closure to allow for the necessary legal and financial processes to be completed. During this period, both companies would work together to finalise the merger, ensuring a smooth transition for shareholders and stakeholders. The second quarter also provided a window of opportunity for CEC Entertainment to build on its recent sales momentum and continue its growth trajectory.

However, it is important to note that, despite the expectations and plans, the merger deal between CEC Entertainment and Leo Holdings ultimately collapsed in July 2019, and the planned return to the public market did not materialise at that time.

The company expects to have a $1.4 billion enterprise valuation following the merger

Chuck E. Cheese, the American entertainment restaurant chain, has had a long and complex financial history, with several mergers and acquisitions over the years. The company has gone through various name changes and shifts in its business model, but it remains a well-known brand, particularly for families.

In 2019, Chuck E. Cheese's parent company, CEC Entertainment, announced plans to go public on the New York Stock Exchange once again through a merger with a special purpose company, Leo Holdings. This move would make it the first restaurant company to enter the public market in four years. The deal was expected to close in the second quarter of 2019, with CEC Entertainment becoming a subsidiary of Chuck E. Cheese Brands, Inc. and trading under the ticker symbol "CEC".

CEC Entertainment's leadership projected optimism about the merger, stating that it was the "perfect time" for Chuck E. Cheese to re-enter the public market. They highlighted the benefits of operating as a private company for the past five years, which allowed them to focus on investing in their business without the pressure of delivering consistent profit growth to investors. During this time, they revamped their menu, introduced new entertainment options, and replaced tokens with RFID cards.

As part of the merger, CEC Entertainment's management provided a financial outlook for the company, stating that they believed CEC Entertainment would have an enterprise value of $1.4 billion following the merger. This valuation took into account the company's performance in fiscal 2018, where they reported net sales of $896 million across their 750 venues, including both Chuck E. Cheese and Peter Piper Pizza brands. It's important to note that more than half of their revenue came from entertainment and merchandise sales, with the remaining 45% from food and beverage.

The $1.4 billion enterprise valuation reflected the company's expectations for future growth and profitability, particularly with their plans to continue investing in their business. This included remodeling stores, introducing new products, and expanding internationally. CEC Entertainment aimed to build on the success of their "All You Can Play" model, which allowed parents to pay for entertainment by time, and their loyalty programs.

In summary, the projected $1.4 billion enterprise valuation of CEC Entertainment following the merger with Leo Holdings was based on the company's recent financial performance, the potential for future growth, and their plans to continue investing in their business and expanding their brand. This move back into the public market presented an opportunity for CEC Entertainment to showcase their evolution and modernization efforts to Wall Street and investors.

The company's leadership team will remain in place

Chuck E. Cheese's parent company, CEC Entertainment, has gone through several mergers and acquisitions over the years, with the most recent development occurring in 2019. After being acquired by Apollo Global Management in 2014 for approximately $948 million, Chuck E. Cheese's parent company announced in April 2019 that it would be merging with Leo Holdings, a publicly traded special purpose acquisition company. This merger would make Chuck E. Cheese a public company again, trading on the New York Stock Exchange under the ticker symbol "CEC".

As part of the merger agreement, it was expected that the current executive management team of CEC Entertainment, led by CEO Tom Leverton, would remain in place. In a statement, Leverton expressed his eagerness to work with Leo Holdings to pursue growth opportunities and continue the company's evolution. The plan included remodelling stores, introducing new products, and expanding internationally.

Leverton's leadership has been instrumental in modernizing the brand. During his tenure, CEC Entertainment made significant investments in the menu, stores, and entertainment offerings. They replaced tokens with RFID cards and introduced an "all you can play" model, allowing parents to pay for entertainment by time. These changes contributed to positive sales growth, with a projected increase of 7.7% in the first quarter of 2019.

The merger between CEC Entertainment and Leo Holdings was expected to close in the second quarter of 2019, with Leo Holdings changing its name to Chuck E. Cheese Brands Inc. However, in July 2019, it was reported that the merger deal had collapsed, and CEC Entertainment would not be going public at that time. No reasons were given for the termination of the deal.

As of 2024, Chuck E. Cheese's parent company, now known as Chuck E. Cheese Brands, is once again a publicly traded company. The leadership team's efforts to revitalize the brand and focus on investing in the business have contributed to Chuck E. Cheese's ongoing presence and recognition in the family entertainment and dining industry.

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