Penn National Acquires Margaritaville Resort In Louisiana

Operator of casinos and racetracks from Wyomissing, Pennsylvania, Penn National Gaming, has added another property to its real-estate assets, after officially announcing the full takeover of Margaritaville Resort Casino in Bossier City, Louisiana.

The gambling giant extended its network of gaming and racing facilities including video gaming terminals across the United States after cashing out a whopping $115 million. According to the official report, this business arrangement was funded “with incremental borrowings under its revolving credit facility.”

Adding Attractive Assets

As part of the purchase contract with Margaritaville, Penn has agreed to inject $23 million for a 15-year lease, since the land on which the property is located belongs to a real estate investment trust company – Vici Properties.

Timothy Wilmott, CEO at Penn National, stated that the addition of Northern Louisiana resort is an attractive investment. He also said that it represents an integral part of the entire gaming platform:

“This acquisition is in line with our efforts to enhance shareholder value as it is immediately accretive to our free cash flow, further diversifies our revenue and operating base and offers a well-defined path to the realization of synergies that are expected to lower the purchase multiple.”

As a reminder, prior to this purchase, the gambling company completed the Pinnacle acquisition for $2.8 billion in October and launched two sportsbooks in Mississippi in August.

Margaritavile At Full Capacity

To provide more insights about Penn National’s latest acquisition, it is important to mention that the resort covers 26,500 square feet including 395 hotel rooms, 6 restaurants, beverages shops, a 15,000 square-foot theater and 9,500 square feet of meeting space.

Another key point regarding this purchase, is that Penn and Vici already collaborated last November when the Wyomissing-based operator acquired Greektown Casino in Detroit, Michigan. To reach this agreement, both companies cashed out $1 billion in total, where Penn paid $300 million to operate the venue and Vici bought the real estate for $700 million.

The establishment is also active in other states, such as West Virginia, where it runs sportsbooks with FanDuel at Hollywood Casino Charles Town and The Greenbrier. During last October, the management has been quite busy as it secured approvals from Nevada Gaming Regulators to acquire Pinnacle Entertainment, report third quarter results and file an application for Hollywood Casino Morgantown.

The month of September was less turbulent but the group still managed to file an application for Hollywood Casino York.

Source:

“Penn National Gaming Completes Acquisition of Margaritaville Resort Casino Operations”, pennnationalgaming.gcs-web.com, January 2, 2019.

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