Posts Tagged ‘Acquire’

Penn National Gaming to Acquire Pinnacle Entertainment for $2.8 Billion

 Penn National Gaming to Acquire Pinnacle Entertainment for $2.8 Billion

Penn National Gaming announced Monday that it has agreed to acquire Pinnacle Entertainment for $ 2.8 billion in combined cash and stock. Pinnacle shareholders will receive $ 20 per share of Pinnacle plus 0.42 shares of Penn National stock for each Pinnacle share they own. The implied price per share is $ 32.47, a 36 premium for Pinnacle based on the company’s closing price on October 4th.

Penn National CEO Timothy Wilmott did some of the usual corporate cheerleading-speak in a press release:

The combined company will benefit from enhanced scale, additional growth opportunities and best-in-class operations, creating a more efficient integrated gaming company. Going forward, we will have the financial and operational flexibility to further execute on our strategic objectives, while maintaining our track record of industry-leading profit margins and generating significant cash flow to reduce leverage over time. We look forward to welcoming Pinnacle’s talented employees to our team and to further enhancing our status as North America’s leading regional gaming operator.

Anthony Sanfilippo, Chariman and CEO of Pinnacle, also had some things to say:

Pinnacle shareholders will receive immediate value from the cash consideration, as well as participation in the longer-term growth of Penn National that we expect will occur from the integration of two great companies into a more efficient, larger-scale gaming entertainment platform. We are also pleased that Boyd Gaming will be acquiring our Ameristar properties in St. Charles and Kansas City, along with Belterra Casino Resort and Belterra Park. We look forward to working closely with Penn National and Boyd to seamlessly transition the Pinnacle businesses to their respective new owners.

As Sanfilippo mentioned, Boyd Gaming – mostly notable the owner of the Orleans, Gold Coast, and Fremont casinos in Las Vegas – is buying four of Pinnacle’s casinos in the deal. The purchase will be made from Penn National after the initial acquisition is completed. Boyd Gaming will pay $ 575 million in cash for the properties.

Both Penn National and Pinnacle Entertainment are “regional” gaming companies, focusing on smaller casinos, mostly in places other than Las Vegas and Atlantic City. That doesn’t mean none of their properties are in gaming hotbeds. Penn National owns the Tropicana in Las Vegas as well as the M Resort in Henderson, Nevada. Its casinos mostly concentrate in Mississippi and the Midwest; Hollywood Casino is one of Penn National’s main brands.

Going into the deal, Pinnacle owned sixteen casino properties in the U.S., though of course four of those will be going to Boyd Gaming. Pinnacle also focuses on the Midwest, Mississippi, and Louisiana. It is (was, I guess) the owner of the Ameristar casino chain.

The boards of both companies have already approved the deal, but it still needs approval from shareholders and gaming authorities. Assuming all goes as planned, the transaction is expected to close in the second half of 2018.

The post Penn National Gaming to Acquire Pinnacle Entertainment for $ 2.8 Billion appeared first on Poker News Daily.

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William Hill, Paddy Power Betfair Competing to Acquire CrownBet

 William Hill, Paddy Power Betfair Competing to Acquire CrownBet

Gambling industry consolidation talks have started up again, this time with Australian bookmaker CrownBet as the acquisition target by both William Hill and Paddy Power Betfair. CrownBet is 62 percent owned by Crown Resorts – Crown Melbourne is the host venue of the popular Aussie Millions poker series – which is itself part of James Packer’s gambling empire.

The news of William Hill’s interest in CrownBet broke late last week and a William Hill spokesperson confirmed to financial media that there were “very preliminary discussions” going on between the two companies.

That spokesperson, though, cautioned against anyone getting too excited over a possible deal, saying, “This industry is undergoing consolidation and people in the sector talk to each other all the time. Don’t look too much into this as a firing gun.”

William Hill got into the Australian sports betting market several years ago, when it bought Sportingbet and TomWaterhouse.com. It has not done well in Australia, though. Canaccord Genuity analyst Simon Davies told The Telegraph that the move has been “fairly disastrous.”

Fortunately, Australia only comprises about six to seven percent of William Hill’s sports betting business.

Not long after the word got out about William Hill’s talks with Crown, Reuters reported that Ireland-based Paddy Power Betfair was also courting the Australian company. No further details have been forthcoming.

Both Paddy Power Betfair and William Hill have been involved in the gambling industry’s consolidation in recent years. Paddy Power and Betfair, once rivals, agreed to a merger in August 2015. Paddy Power owners controlled 52 percent of the company in the deal. It was one of the rare combinations in which the two companies had a strong understanding of the other before the merger took place, as Betfair CEO Breon Corcoran was once COO of Paddy Power.

Edward Wray, co-founder and Chairman of Betfair, told The Financial Times of Corcoran back then, “He knows both businesses inside out. Often when you do a merger, it is 25 per cent known and 75 per cent unknown. This is the other way around.”

William Hill has been very active in the M&A arena. In 2015, the company was thought to be one of the suitors for bwin.party and before that, it attempted to acquire 888 Holdings. William Hill was in talks to merge with Gala Coral, as well, in 2015, but nothing ever happened there. Gala Coral eventually joined up with Ladbrokes.

Last year, in a reversal, 888 Holdings attempted to acquire William Hill, teaming with The Rank Group to do so. William Hill rejected multiple bids by the duo, rankling 888 owner Eyal Shaked, who tweeted, “Pure ego made #WilliamHill reject #Rank and #888 £3.16bn bid and that will be their downfall.”

Also in 2016, William Hill and Amaya Gaming – now The Stars Group, parent company of PokerStars – were in talks about a “merger of equals.” Mads Eg Gensmann and Edoardo Mercadante, co-founders of Parvus Asset Management, William Hill’s largest shareholder, hated the deal, writing to the William Hill board, “We strongly encourage that the board and management stops wasting valuable time and shareholder resources pursuing this value-destroying deal.”

Eventually, talks were canceled. Stay tuned to find out if William Hill finally finds a merger partner.

The post William Hill, Paddy Power Betfair Competing to Acquire CrownBet appeared first on Poker News Daily.

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