Pinnacle Entertainment (PNK) Announces PGCB Approves Acquisition of Meadows (GLPI)
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Pinnacle Entertainment, Inc. (NASDAQ: PNK) announced today the Pennsylvania Gaming Control Board (“PGCB”) approved the Company’s previously announced acquisition of the operations of the Meadows Racetrack and Casino (“Meadows”) from Gaming and Leisure Properties, Inc. (“GLPI”). Today’s approval by the PGCB represents the final regulatory clearance required to complete the transaction, following the earlier approval by the Pennsylvania Harness Racing Commission in August 2016. The Company expects to complete the transaction on Friday, September 9, 2016 for total consideration of $138.0 million, subject to a working capital adjustment and customary closing conditions, and intends to finance the purchase by drawing on its revolving credit facility.
Anthony Sanfilippo, Chief Executive Officer of Pinnacle Entertainment, commented, “We thank the Pennsylvania Gaming Control Board and the Pennsylvania Harness Racing Commission for their diligence, professionalism and expedience in reviewing and approving the Meadows transaction. We are excited to expand our company into the state of Pennsylvania and the greater Pittsburgh metropolitan area, and look forward to welcoming the guests and 1,300 team members of the Meadows into the Pinnacle Entertainment family.
“The Meadows is a beautiful and dynamic gaming entertainment destination situated in a stunning location. The Meadows has a broad base of operations, that encompasses high quality gaming and other guest entertainment amenities, as well as talented team members that deliver memorable service experiences to its guests. The Meadows will complement our existing collection of terrific properties and provide additional operational scale, geographic diversification, and another wonderful location for the guests of Pinnacle Entertainment’s 15 other gaming entertainment businesses to visit,” concluded Mr. Sanfilippo.
Following the completion of the transaction, Pinnacle will operate the Meadows’ gaming entertainment business and lease its underlying real property from GLPI in a triple net lease with initial annual rent of $25.4 million. On a trailing twelve month basis at June 30, 2016, the Meadows generated net revenues of approximately $290 million and Adjusted EBITDAR of approximately $48 million. The Company expects to account for the Meadows lease as an operating lease under GAAP.
The Meadows is located in Washington, PA, approximately 25 miles outside of Pittsburgh, PA. The property features a casino and pari-mutuel gaming experience that includes approximately 3,170 gaming devices, 74 table games, 11 poker tables, and a 5/8 mile horse racetrack with a 500-seat grandstand. Additionally, the Meadows features a full complement of other guest entertainment amenities, including 11 casual and fine dining restaurants, bars and lounge outlets, 7,500 sq. ft. of banquet space, an 11,000 sq. ft. event center, a 24-lane bowling center, and hotel accommodations provided by an attached, but separately managed, Hyatt Place hotel with 155 guest rooms.
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