Pennsylvania-based casino and racetrack operator Penn National Gaming revealed that it entered into a definitive agreement under which it is to acquire the operations of Bossier City-based Margaritaville Resort Casino. Penn National Gaming further revealed that it is to partner with New York-based VICI Properties Inc. in order to purchase the resort casino’s assets.
Under the companies’ agreement for the acquisition of Margaritaville, which is located next to the Louisiana Broadwalk shopping center, VICI Properties is set to get the land and real estate assets of the resort casino at the price of approximately US$261 million in cash. On the other hand, Penn National is to acquire Margaritaville’s operating assets for an amount of $115 million in cash.
At the time when the takeover deal is finalized, a lease agreement is to be inked between Penn National and VICI Properties. The annual rent that is to be owed by the company will amount to approximately $23 million for a period of 15 years, with the possibility for four five-year renewals. Under the lease contract, insurance and maintenance costs, as well as property taxes, will be paid by the Pennsylvania-based operator in addition to rent.
The sale is expected to be finalized over the second half of 2018.
Penn National Seeks Market Expansion through Acquisitions
This is not the only pending acquisition of Penn National for the time being. In late 2017, the company announced that it is to purchase Pinnacle Entertainment. The latter operates four gambling riverboats on the territory of the state of Louisiana, including the Boomtown Casino and Hotel in Bossier City. The acquisition, however, is still waiting for the official approval of local regulatory authorities.
Over the past couple of years, Penn National has been looking for merger and acquisition deals. The casino and racetrack operator purchased the Tropicana, its second casino in Las Vegas, in 2017. March 2018 saw the company acquire two Mississippi casinos as well as Bally’s Casino Tunica Resorts. Penn National also bought Rocket Games, a San Francisco-based social casino games operator.
Now, the shopping spree of Penn National continues with the purchase of Margaritaville Casino’s operations. Over the years, the company expanded its reach to a total of 29 gaming facilities situated in seventeen US states as well as in Canada.
Margaritaville Resort Casino was established in Bossier City in June 2013. The gambling facility hosts 1,215 slot machines and 50 gaming tables, while the hotel facility of the resort offers 395 guest rooms, six restaurants, as well as a 1,000-seat theater. The Chief Executive of VICI Properties, Ed Pitoniak, noted that the property has already shown “exceptional performance”, especially considering the fact that it is the newest casino venue brought to the local market. Mr. Pitoniak also called the property one of the current market leaders in the region.
