Gaming and Leisure Properties to Acquire Two Regional Gaming Properties for $484 Million and Simultaneously Enter Into a New ...
October 27 2020 - 5:30PM
Gaming and Leisure Properties, Inc. (NASDAQ: GLPI) (“GLPI” or
the “Company”) announced today that it entered into definitive
agreements to acquire the real property assets of Dover Downs Hotel
and Casino from Twin River Worldwide Holdings, Inc. (“Twin River”)
(NYSE: TRWH) and to re-acquire the real property assets of
Tropicana Evansville from Caesars Entertainment, Inc. (“Caesars”)
(NASDAQ: CZR), after the substitution right related to the property
was triggered. Pursuant to the Tropicana Evansville agreement, GLPI
will acquire the real property assets for approximately $340.0
million, and Twin River will acquire the operating assets of the
property for approximately $140.0 million. GLPI will separately
engage in a sale-leaseback transaction directly with Twin River for
Dover Downs, and will acquire the real property for $144.0 million.
The two properties have an aggregate real estate purchase price of
approximately $484 million.
Simultaneous with the closing of these
transactions, GLPI will enter into a new triple-net master lease
with Twin River for both assets with an initial term of 15 years,
with four 5-year tenant renewal options. The initial annual cash
rent will be $40.0 million, representing an implied capitalization
rate of 8.3%. The trailing rent coverage ratio in the first year
after closing is expected to approximate 2.1x and the master lease
obligations will be subject to a corporate guarantee from Twin
River.
Peter Carlino, Chairman and CEO of GLPI,
commented, “We are excited to establish a formal relationship with
Twin River as they represent another leading operator to add to
GLPI’s growing platform. Our new master lease with Twin River will
have strong rent coverage at an accretive cap rate and is the
result of our team’s hard work to structure and complete a complex
transaction that benefits both parties. These transactions further
diversify our portfolio with the addition of a new operator and
expands our footprint into Delaware.”
“Twin River is pleased to be working with GLPI
on these transactions. They allow us to further expand our regional
presence into Indiana while monetizing the real estate at Dover
Downs,” commented George Papanier, President and Chief Executive
Officer of Twin River. “Twin River looks forward to
collaborating with GLPI in our efforts to grow and diversify our
high-quality portfolio of regional gaming assets.”
The transaction is expected to close in
mid-2021, subject to receipt of required regulatory approvals and
other customary closing conditions. In a continuation of GLPI’s
focus on prudent balance sheet management, we will consider a menu
of options to permanently fund the transactions including the use
of retained cash flow, potential disposition proceeds from the
Tropicana and/or our Perryville option with Penn, issuance under
our ATM program, proceeds of one or more future capital markets
transactions and/or the use of our revolving credit facility.
About Gaming and Leisure
PropertiesGLPI is engaged in the business of acquiring,
financing, and owning real estate property to be leased to gaming
operators in triple-net lease arrangements, pursuant to which the
tenant is responsible for all facility maintenance, insurance
required in connection with the leased properties and the business
conducted on the leased properties, taxes levied on or with respect
to the leased properties and all utilities and other services
necessary or appropriate for the leased properties and the business
conducted on the leased properties.
Forward-Looking StatementsThis
press release includes “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
including our expectations regarding our ability to complete the
transactions and the accretive impact of such transactions.
Forward-looking statements can be identified by the use of
forward-looking terminology such as “expects,” “believes,”
“estimates,” “intends,” “may,” “will,” “should” or “anticipates” or
the negative or other variation of these or similar words, or by
discussions of future events, strategies or risks and
uncertainties. Such forward looking statements are inherently
subject to risks, uncertainties and assumptions about GLPI and its
subsidiaries, including risks related to the following: GLPI’s
ability to successfully consummate the announced transactions with
Caesars and Twin River, including the ability of the parties to
satisfy the various conditions to closing, including receipt of all
required regulatory approvals, or other delays or impediments to
completing the proposed transactions; the ability to receive, or
delays in obtaining, the regulatory approvals required to own
and/or operate its properties, or other delays or impediments to
completing acquisitions or projects; GLPI's ability to maintain its
status as a REIT; our ability to access capital through debt and
equity markets in amounts and at rates and costs acceptable to
GLPI; the impact of our substantial indebtedness on our future
operations; changes in the U.S. tax law and other state, federal or
local laws, whether or not specific to REITs or to the gaming or
lodging industries; and other factors described in GLPI’s Annual
Report on Form 10-K for the year ended December 31, 2019, Quarterly
Reports on Form 10-Q and Current Reports on Form 8-K, each as filed
with the Securities and Exchange Commission. All subsequent written
and oral forward-looking statements attributable to GLPI or persons
acting on GLPI’s behalf are expressly qualified in their entirety
by the cautionary statements included in this press release. GLPI
undertakes no obligation to publicly update or revise any
forward-looking statements contained or incorporated by reference
herein, whether as a result of new information, future events or
otherwise, except as required by law. In light of these risks,
uncertainties and assumptions, the forward-looking events discussed
in this press release may not occur as presented or at all.
Contact
JCIR,
Investor Relations |
Gaming
and Leisure Properties |
Joseph Jaffoni, Richard Land, James Leahy |
Matthew Demchyk, SVP, Investments |
T: 212/835-8500 |
T: 610/401-2900 |
Email: glpi@jcir.com |
Email: investorinquiries@glpropinc.com |
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