Boyd Gaming Corporation Buys Pinnacle Casinos, Paving The Way For Penn National’s $2.8 billion Pinnacle Acquisition
Gaming giant Boyd Gaming Corporation has announced that it has completed its purchase of four casinos from its rival, Pinnacle Entertainment for an amount of $563.5 in cash, approximately. With the completion of this purchase, Boyd now has Belterra Casino Resort (Florence, Indiana), Belterra Park (Cincinnati, Ohio), and Ameristar St. Charles as well as Ameristar (Kansas City, Missouri under its wing.
This deal helped Boyd to establish its presence in ten states in the US, including Illinois, Nevada, Iowa, Ohio, Pennsylvania, Louisiana, Mississippi, Indiana, Kansas, and Missouri. In these ten states, the major gaming company now operates a total of 29 properties including its four newly acquired ones.
Keith Smith, CEO and President of Boyd said that by adding these four casino properties their portfolio, the company now has access to three of the biggest gaming markets right now in the Midwest.
With Boyd completing its purchase from Pinnacle, Penn National could finally acquire Pinnacle Entertainment for a whopping $2.8 billion deal. Even though the acquisition was given a green light by the US Federal Trade Commission last week, Boyd was required to first complete its purchase of the four properties before Penn National and Pinnacle could sign their multibillion-dollar deal.
Timothy J. Wilmott, CEO of Penn National said in a press release that his company’s acquisition of Pinnacle Entertainment was a “significant milestone” in all of its 24 years of growth. As a result of the deal, Penn National expects to realize cost synergies of about $100 million. It also has a plan to generate more revenue synergies through monetization of their database, cross-marketing properties, sports betting and leveraging the company’s social gaming platform.
Land-based casino industry sees the acquisition/merger trend
These two deals between Boyd and Pinnacle, and Penn National and Pinnacle are testimony of the merger/acquisition trend that is gaining traction in the land-based casino industry in the US.
Less than a month ago, Boyd Gaming Corporation also acquired Valley Forge Casino Resort in King of Prussia, Pennsylvania. Meanwhile, giant gambling operator Caesars has bought two casino properties based in Indiana from Centaur Holdings for a reported $1.7-billion deal. In addition, Tropicana Entertainment was also recently bought by Eldorado Resorts just a few days ago for $1.85 billion.
This trend is attributed to the increasing competition, as well as the legalization of gambling in several states, and the legalization of sports betting by the US Supreme Court in May earlier this year.
