WYOMISSING, Pa. -- (Business Wire)
Penn National Gaming, Inc. (PENN: Nasdaq) (the “Company,” or “Penn
National”) announced today that it entered into a definitive agreement
to acquire Illinois video gaming terminal (“VGT”) operator Prairie State
Gaming (“PSG”) in an all cash transaction. One of the largest VGT route
operators in Illinois, PSG’s operations include more than 1,100
terminals across a network of 270 bar and retail gaming establishments
throughout the State. For the twelve-months ended June 30, 2015, PSG
generated nearly $10 million in EBITDA (earnings before interest, taxes,
depreciation and amortization). The transaction, which is expected to be
immediately accretive to Penn National upon closing later this quarter,
is subject to regulatory and other customary approvals and conditions.
Jay Snowden, Chief Operating Officer of Penn National Gaming, commented,
“The planned acquisition of PSG is consistent with our proven long-term
strategy for growth through accretive acquisitions. PSG is one of
Illinois’ most respected VGT operators, with a strong track record of
regulatory compliance and a reputation for reliable around the clock
service backed by one of the industry’s most experienced teams. With its
strong financial position, PSG has also distinguished itself in the
Illinois VGT industry for its ability to quickly roll out new games to
customers.
“Penn National looks forward to adding our nearly two decades of
industry leading experience in marketing, player development and
operating electronic casino games in highly regulated environments,”
added Snowden. “We believe this acquisition will provide us a solid
platform for future growth in the Illinois VGT market and potentially
other states where this form of gaming is authorized,” concluded Snowden.
John Canham, current acting General Manager at Hollywood Casino at
Kansas Speedway, will assume the newly created role of General Manager
of VGT Operations for Penn National, subject to customary regulatory
approvals. Mr. Canham will report directly to Ameet Patel, Senior Vice
President, Regional Operations for Penn National.
Throughout his 36-year gaming industry career, Mr. Canham has served in
many diverse roles. Prior to assuming the role of acting General Manager
at Hollywood Casino at Kansas Speedway, he served as Vice President of
Casino Operations at the property beginning in 2014. Before that he was
Director of Operations at Boomtown Biloxi from 2008 to 2014, during
which time he spent two years in a corporate slot role with
responsibility for negotiating Master Purchase Agreements with slot
manufacturers and other special projects. Mr. Canham previously served
in various roles at Hollywood Casino Baton Rouge from 1994 to 2008
including Table Games Manager and Slot Operations Manager. He began his
career with London Clubs in England and subsequently worked in a variety
of supervisory and management positions in a number of casinos
internationally, including Crystal Palace Casino in the Bahamas and
Casino Jasmine in Cyprus.
Rob Miller, founder and president of PSG, will remain with the company
as a strategic advisor and will be working closely with Mr. Canham to
ensure a smooth transition and to continue supporting PSG’s retail
gaming, bar, restaurant, and veteran organization customers.
About Penn National Gaming
Penn National Gaming owns, operates or has ownership interests in gaming
and racing facilities with a focus on slot machine entertainment. At
June 30, 2015, the Company operated twenty-six facilities in seventeen
jurisdictions, including Florida, Illinois, Indiana, Kansas, Maine,
Massachusetts, Maryland, Mississippi, Missouri, Nevada, New Jersey, New
Mexico, Ohio, Pennsylvania, Texas, West Virginia, and Ontario. At June
30, 2015, in aggregate, Penn National Gaming’s operated facilities
featured approximately 32,000 gaming machines, 760 table games and 3,100
hotel rooms.
About Prairie State Gaming
Prairie State Gaming (PSG) was founded by gaming entrepreneur Rob Miller
with financing from an affiliate of Och-Ziff Real Estate. PSG is one of
the top five largest terminal operators in Illinois, with more than
1,100 VGTs across 270 bar and retail gaming establishments in seven
distinct geographic areas throughout Illinois. PSG operates a portfolio
of multi-title VGTs under long-term placement agreements, while also
providing a range of ancillary amusement and gaming equipment to its
customers.
Wells Fargo Securities is acting as financial advisor to PSG in this
matter.
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,” “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,
including future plans, strategies, performance, developments,
acquisitions, capital expenditures, and operating results. Actual
results may vary materially from expectations. These forward looking
statements are inherently subject to risks, uncertainties and
assumptions about Penn National Gaming and its subsidiaries, including
risks related to required regulatory approvals and other conditions to
closing, the successful integration of the acquisition, our ability to
successfully compete in the VGT market, our ability to retain existing
customers and secure new customers, risks relating to municipal
authorization of VGT operations and, accordingly, any forward looking
statements are qualified in their entirety by reference to the factors
discussed in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2014, as well as any subsequent Quarterly Reports on Form
10-Q and Current Reports on Form 8-K, each as filed with the United
States 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: http://www.businesswire.com/news/home/20150731005408/en/
Contacts:
Penn National Gaming, Inc.
Saul V. Reibstein
Chief Financial
Officer
610-373-2400
or
JCIR
Joseph N. Jaffoni,
Richard Land
212-835-8500
penn@jcir.com
Source: Penn National Gaming, Inc.
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