The stock market gained ground Tuesday morning, closing the first half of 2020 on a positive note. Although plenty of uncertainty remains, investors have adopted a generally upbeat tone, expecting further efforts to help stimulate the economy and keep stocks moving higher. Just after 11 a.m. EDT today, the Dow Jones Industrial Average (DJINDICES:^DJI) was up 49 points to 25,645. The S&P 500 (SNPINDEX:^GSPC) gained 22 points to 3,075, and the Nasdaq Composite (NASDAQINDEX:^IXIC) picked up 108 points to 9,982.

Special purpose acquisition companies (SPACs) have been all the rage on Wall Street lately, with many privately held businesses turning to SPACs to help give them access to public stock markets without going through the lengthy traditional IPO process. Late Monday, billionaire business personality Tilman Fertitta announced a deal that will bring an up-and-coming business in the online gambling industry to ordinary investors. Those who anticipated such a deal, without knowing exactly what it would look like, are reaping the rewards.

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A winner for Landcadia

Shares of Landcadia Holdings II (NASDAQ:LCA) moved higher by more than 10% Tuesday morning. The stock had been up as much as 18% earlier in the session as investors weighed the merger announcement from the SPAC.

Landcadia II has entered into a purchase agreement to acquire the internet gambling company Golden Nugget Online Gaming. The deal involves Fertitta on both sides, as the Houston Rockets owner is the current owner of Golden Nugget, and his Fertitta Entertainment unit is a co-sponsor of Landcadia II.

The deal values Golden Nugget at $745 million, with its owners receiving a combination of cash and shares of Landcadia II. After the merger is complete, Fertitta will retain a controlling economic interest in the combined company, with super-voting shares giving him even greater voting control. Landcadia II will assume $150 million in debt and use $150 million more in cash to pay down debt once the deal closes.

Landcadia II's board of directors has unanimously approved the agreement, but it will require approval by shareholders. For purposes of majority approval, the shares that Fertitta owns won't be included, nor will those owned by SPAC co-sponsor Jefferies Financial Group (NYSE:JEF).

Placing their bets

The online gambling industry has been a fertile one for SPACs lately. Earlier this year, DraftKings (NASDAQ:DKNG) came public using the SPAC structure, and although Golden Nugget's business isn't the same as that of the fantasy sports giant, the price is a relatively attractive one for Landcadia II shareholders.

The big question for investors is whether online gambling will benefit from coronavirus-related closures. Las Vegas and other live gambling areas had begun the reopening process, but the wave of new COVID-19 cases could prompt casino resort operators to rethink their decisions. Local officials could also force further closures. So far, trends in online gambling have shown solid upticks in activity during the worst of the pandemic, as the desire for entertainment apparently outweighed the economic pressures that many experienced from layoffs or furloughs.

The news is welcome for internet gambling stocks, but it's also a vote of confidence for the special purpose acquisition company niche. With a host of new SPACs coming onto the market, investors will have to watch closely to see which ones are able to find potentially lucrative business deals like this one.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.