Former Platinum Club II Will Become a Club Onyx
Rick's Cabaret International, Inc. (NASDAQ/GM: RICK), premium operator of upscale gentlemen's clubs, said today it has completed the purchase of Platinum Club II in Dallas, TX, and will re-brand it as an upscale Club Onyx catering to African-American gentlemen.
Rick's Cabaret paid $1.5 million in cash for the adult nightclub at the intersection of 10557 Wire Way and Northwest Highway, just off busy I-35 Stemmons Freeway. The company also acquired the accompanying real estate for $6 million, paying $1.65 million in cash and financing the balance. It is the company's second acquisition in Dallas this year and the third in the Dallas-Ft. Worth 'Metroplex.'
Rick's Cabaret estimates the club will add approximately $4 to $5 million in annual revenue, with earnings before income tax, depreciation and amortization (EBITDA) between $1.5 million to $2 million. This estimate was not included in the company's latest earnings guidance update on May 8th.
'The more we get to know the Dallas market the more enthusiastic we have become about the potential for an upscale Club Onyx facility,' said Eric Langan, President and CEO of Rick's Cabaret. 'Dallas has the great mix of professional athletes, music artists and business executives that has made our Club Onyx brand successful in Houston and Charlotte. We also will benefit from management efficiencies and purchasing power now that we have three locations in the Dallas-Ft. Worth market. We are pleased that we completed this transaction well within the time period originally announced to our investors.'
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