Sam Boughedda

Investing.com — Dave & Buster’s Entertainment (NASDAQ:) shares tumbled 10% after it announced the acquisition of Main Event from Ardent Leisure Group and RedBird Capital Partners on Wednesday. 

In an all-cash deal, the arcade and restaurant business paid $835million. The transaction is expected to close late in 2015. This purchase price is approximately 9x earnings before taxes and interest.

In addition, the deal will also see the current CEO of Main Event, Chris Morris, be named CEO of Dave & Busters following Brian Jenkins retirement.

“We are thrilled to welcome Main Event to the Dave & Buster’s family,” said Kevin Sheehan, board chair and interim CEO. It is an exciting combination for both brands.

The companies anticipate $20 million cost savings through store support and supply chain efficiency during the first 2 years after the agreement is finalized.