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Anchor to Merge with Powerhouse

The merger creates a diversified international gaming entity with combined revenues of approximately $450 million. The transaction values Powerhouse at approximately $280 million, consisting of approximately $220 million of equity value and approximately $60 million of net debt estimated at closing.

"This transaction represents an outstanding opportunity for Anchor to maximize long-term shareholder value by strategically transforming our company," Anchor Chairman Stan Fulton said. "With our strong balance sheet, we will be able to provide the capital necessary to fund the many growth opportunities inherent in Powerhouse's business segments."

CEO Michael Rumbolz added, "The acquisition of Powerhouse provides Anchor with management depth and increased technological and manufacturing capabilities. The integration of these capabilities will enhance Anchor's technological leadership and growth opportunities in our proprietary games division."

In conjunction with the acquisition, Anchor announced it intends to seek shareholder approval to change its name from Anchor Gaming to Anchor Technologies.

The transaction is subject to approval by the shareholders of Powerhouse and the expiration of applicable waiting periods under the Hart-Scott Rodino Antitrust Improvement Act. The transaction, which will also require approval of various gaming authorities, is expected to close in the second half of calendar 1999.

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