Provides Company with Access to Upcoming Sports Betting
Market in Maryland
Penn National Gaming, Inc. (PENN: Nasdaq) (“Penn National” or
the “Company”) announced today that it entered into a definitive
agreement with Gaming and Leisure Properties, Inc. (GLPI: Nasdaq)
(“GLPI”) to acquire the operations of Hollywood Casino Perryville
in Maryland for $31.1 million in cash, subject to certain customary
working capital adjustments. Simultaneous with the closing of the
transaction, Penn National will enter into a lease with GLPI for
the real estate assets associated with the Hollywood Casino
Perryville facility with annual rent of approximately $7.77
million.
“Penn National is excited to acquire the operations of Hollywood
Casino Perryville, a property we developed in 2010, which will
allow us to re-enter the strong Maryland gaming market and add a
twentieth gaming jurisdiction to our leading nationwide footprint,”
said Jay Snowden, President and CEO of Penn National.
“In addition, with the recent approval of sports betting through
the overwhelming passage of Question 2 on Election Day, Maryland is
expected to soon become a significant retail and mobile sports
betting market. As such, this acquisition provides another
opportunity to expand our unique omni-channel platform with a
Barstool-branded retail sportsbook and mobile app,” concluded Mr.
Snowden.
The transaction is expected to close in mid-2021, subject to the
approval of the Maryland Lottery and Gaming Control Commission and
other customary closing conditions.
About Penn National Gaming
With the nation's largest and most diversified regional gaming
footprint, including 41 properties across 19 states, Penn National
continues to evolve into a highly innovative omni-channel provider
of retail and online gaming, live racing and sports betting
entertainment. The Company's properties feature approximately
50,000 gaming machines, 1,300 table games and 8,800 hotel rooms,
and operate under various well-known brands, including Hollywood,
Ameristar, and L'Auberge. Our wholly-owned interactive
division, Penn Interactive, operates retail sports betting
across the Company's portfolio, as well online social casino,
bingo, and iCasino products. In February 2020, Penn National
entered into a strategic partnership with Barstool Sports, whereby
Barstool is exclusively promoting the Company's land-based and
online casinos and sports betting products, including the Barstool
Sportsbook mobile app, to its national audience. The Company's
omni-channel approach is bolstered by the myChoice loyalty program,
which rewards and recognizes its over 20 million members for their
loyalty to both retail and online gaming and sports betting
products with the most dynamic set of offers, experiences, and
service levels in the industry.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the Private Securities Litigation Reform Act of
1995. These statements can be identified by the use of
forward-looking terminology such as “expects,” “believes,”
“estimates,” “projects,” “intends,” “plans,” “goal,” “seeks,”
“may,” “will,” “should,” or “anticipates” or the negative or other
variations of these or similar words, or by discussions of future
events, strategies or risks and uncertainties. Specifically,
forward looking statements include, but are not limited to,
statements regarding: the expected benefits and potential
challenges of the Perryville transaction with Gaming and Leisure
Properties, Inc., including the anticipated benefits for the
Company’s online and retail sports betting, iCasino and social
casino products; the projected closing date of the Perryville
transaction; the Company’s online strategy; the expected launch and
expansion of the Barstool-branded mobile sports betting product and
its future revenue and profit contributions; and the Maryland
gaming market, including with regards to retail and mobile sports
betting. Such statements are all subject to risks, uncertainties
and changes in circumstances that could significantly affect the
Company’s future financial results and business.
Accordingly, the Company cautions that the forward-looking
statements contained herein are qualified by important factors that
could cause actual results to differ materially from those
reflected by such statements. Such factors include, but are not
limited to: (a) the magnitude and duration of the impact of the
COVID-19 pandemic on general economic conditions, capital markets,
unemployment, consumer spending and the Company’s liquidity,
financial condition, supply chain, operations and personnel; (b)
industry, market, economic, political, regulatory and health
conditions; (c) disruptions in operations from data protection
breaches, cyberattacks, extreme weather conditions, medical
epidemics or pandemics such as the COVID-19 (and reoccurrences),
and other natural or man-made disasters or catastrophic events; (d)
the reopening of the Company’s gaming properties are subject to
various conditions, including numerous regulatory approvals and
potential delays and operational restrictions; (e) our ability to
access additional capital on favorable terms or at all; (f) our
ability to remain in compliance with the financial covenants of our
debt obligations; (g) the closing of the Perryville transaction may
be delayed or may not occur at all, for reasons beyond our control;
(h) the ability to satisfy the closing conditions to the Perryville
transaction in a timely basis or at all; (i) potential adverse
reactions or changes to business or regulatory relationships
resulting from the announcement or completion of the transaction;
(j) actions to reduce costs and improve efficiencies to mitigate
losses as a result of the COVID-19 pandemic that could negatively
impact guest loyalty and our ability to attract and retain
employees; (k) the outcome of any legal proceedings that may be
instituted against the Company, GLPI or their respective directors,
officers or employees; (l) the impact of new or changes in current
laws, regulations, rules or other industry standards; (m) the
occurrence of any event, change or other circumstances that could
give rise to the right of one or both of the Company and GLPI to
terminate any of the transaction agreements between the companies;
(n) the ability of our operating teams to drive revenue and
margins; (o) the impact of significant competition from other
gaming and entertainment operations (including from Native American
casinos, historic racing machines, state sponsored i-lottery
products and VGTs in or adjacent to states in which we operate);
(p) our ability to obtain timely regulatory approvals required to
own, develop and/or operate our properties, or other delays,
approvals or impediments to completing our planned acquisitions or
projects, construction factors, including delays, and increased
costs; (q) the passage of state, federal or local legislation
(including referenda) that would expand, restrict, further tax,
prevent or negatively impact operations in or adjacent to the
jurisdictions in which we do or seek to do business (such as a
smoking ban at any of our properties or the award of additional
gaming licenses proximate to our properties, as recently occurred
with legislation in Illinois and Pennsylvania); (r) the effects of
local and national economic, credit, capital market, housing, and
energy conditions on the economy in general and on the gaming and
lodging industries in particular; (s) the activities of our
competitors (commercial and tribal) and the rapid emergence of new
competitors (traditional, internet, social, sweepstakes based and
VGTs in bars and truck stops); (t) increases in the effective rate
of taxation for any of our operations or at the corporate level;
(u) our ability to identify attractive acquisition and development
opportunities (especially in new business lines) and to agree to
terms with, and maintain good relationships with partners and
municipalities for such transactions; (v) the costs and risks
involved in the pursuit of such opportunities and our ability to
complete the acquisition or development of, and achieve the
expected returns from, such opportunities; (w) the impact of
weather, including flooding, hurricanes and tornadoes; (x) changes
in accounting standards; (y) the risk of failing to maintain the
integrity of our information technology infrastructure and
safeguard our business, employee and customer data (particularly as
our iGaming division grows); (z) with respect to our iGaming and
sports betting endeavors, the impact of significant competition
from other companies for online sports betting, iGaming and
sportsbooks, our ability to achieve the expected financial returns
related to our investment in Barstool Sports, our ability to retain
key talent, our ability to obtain timely regulatory approvals
required to own, develop and/or operate sportsbooks may be delayed
and there may be impediments and increased costs to launching the
online betting, iGaming and sportsbooks, including delays, and
increased costs, intellectual property and legal and regulatory
challenges, as well as our ability to successfully develop
innovative products that attract and retain a significant number of
players in order to grow our revenues and earnings, our ability to
establish key partnerships, our ability to generate meaningful
returns and the risks inherent in any new business; (aa) with
respect to our proposed Pennsylvania Category 4 casinos in York and
Berks counties, risks relating to construction, and our ability to
achieve our expected budgets, timelines and investment returns,
including the ultimate location of other gaming properties in the
Commonwealth of Pennsylvania; and (bb) other factors as discussed
in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2019, subsequent Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K, each as filed with the U.S. Securities
and Exchange Commission. The Company does not intend to update
publicly any forward-looking statements 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.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201215005224/en/
David Williams Chief Financial Officer Penn National Gaming
610/373-2400
Joseph N. Jaffoni, Richard Land JCIR 212/835-8500 or
penn@jcir.com
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