The joint $59.3m sale of the operations of Hollywood Casino Perryville in Maryland and Hollywood Casino Baton Rouge to Penn National Gaming and Casino Queen Holding Company has been announced by Gaming and Leisure Properties.
Subject to regulatory approvals and other normal closing conditions, both transactions are scheduled to close in the second half of 2021.
PNG, which has praised the business potential held by Maryland, will take its US casino footprint to 41 properties across 19 states with the deal.
Simultaneously with the closing of the $31.1 million deal, GLPI will enter into a new lease with the Hollywood Casino Perryville-related real estate assets company, for an initial annual cash rental of approximately $7.77 million. The contract, with four five-year extensions, would have an initial duration of 15 years.
Jay Snowden, president and CEO of Penn National said: “Penn National is excited to acquire the operations of Hollywood Casino Perryville, a property we developed in 2010, which will allow us to re-enter the strong Maryland gaming market and add a twentieth gaming jurisdiction to our leading nationwide footprint.
“In addition, with the recent approval of sports betting through the overwhelming passage of question two on election day, Maryland is expected to soon become a significant retail and mobile sports betting market.
“As such, this acquisition provides another opportunity to expand our unique omni-channel platform with a Barstool-branded retail sportsbook and mobile app.”
In addition, the real estate investment trust has also outlined Hollywood Casino Baton Rouge’s $28.2m divestment to Casino Queen Holding Company.
GLPI will maintain control of all HCBR real estate properties and will concurrently enter into a Casino Queen master lease, which will also include both the DraftKings at the East St Louis Casino Queen site, for an initial annual cash rental of approximately $21.4 million. The contract, with four five-year extensions, would have an initial duration of 15 years.
GLPI will also have the right of first refusal with Casino Queen for other sales leaseback deals up to 50 m for the next two years in accordance with the deal.
Casino Queen is a regional gaming company operated by Regular General that operates four casinos in three states, or is under contract to purchase them, and focuses on expanding its casino and sports betting operations further.
GLPI’s Chairman and CEO, Peter Carlino, commented: “The sale of our operations in Baton Rouge and Perryville is bittersweet as both properties were foundational to the creation of GLPI seven years ago.
“We are grateful to the team members who do an amazing job managing these properties and delivering great guest entertainment and amenities, particularly in the face of the challenges brought on by the pandemic.
“We are confident that they are in good hands with the new operators of these properties and will continue to shine under Penn National and Casino Queen. By retaining the real estate of both Perryville and Baton Rouge, and continuing the development on the expansion in Baton Rouge, we retain a vested interest in their future.
“Finally, while we have decided to divest these operations to focus on our core business, our institutional knowledge and ability to operate gaming facilities at a high level remain intact should a compelling opportunity arise in the future.”