GLPI Acquires Pinnacle Properties in $4.74 Billion Deal
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February 19, 2020
Anthony Sanfilippo, CEO of Pinnacle Entertainment: ‘ This may be a transaction that is compelling unlocks the value of Pinnacle’s real-estate assets and delivers substantial value to your shareholders.’
Gaming and Leisure Properties Inc (GLPI), the gambling industry’s first owning a home trust (REIT), will obtain all of Pinnacle Entertainment’s real estate’s assets in an all-stock transaction that values the holdings at $4.74 billion.
Pinnacle rebuffed a GLPI offer in March well worth $4.1 billion.
Beneath the terms of the deal, Pinnacle’s operating product and the real property of Belterra Park Gaming & Entertainment will be spun off in to a separately exchanged company that is public as OpCo, while GLPI will obtain the real estate assets of the remaining business, PopCo.
Pinnacle investors will own roughly 27 percent of the combined company and 100 percent of OpCo.
The enlarged group will form a powerhouse real estate investment trust which will own 35 casino and hotel facilities in 14 states, the third-largest publicly traded triple-net REIT in the world.
Pinnacle’s Achievements
Pinnacle traces its history back to 1938, when Jack L Warner opened the Hollywood Park Racetrack.
It owns 15 casino properties across the US and also has a 26 percent stake in Asian Coast Development Ltd, the owner and developer of the Ho Tram Strip in Vietnam today.
The company changed its title from Hollywood Park Inc to Pinnacle Entertainment when the racetrack was sold to Churchill Downs in 2000.
In 2013 Pinnacle acquired Ameristar Casinos for $869 million and $1.9 billion of assumed debt, adding nine properties that are new its profile and essentially doubling in dimensions.
‘Pinnacle’s real estate profile brings great properties to GLPI and adds one associated with gaming that is leading as being a brand new tenant,’ said Peter Carlino, Chairman and CEO of GLPI. ‘Pinnacle’s proven history of continued operating that is improving will make GLPI even stronger as we pursue long-term growth.’
The REIT Stuff
A REIT is really a company that buys property through combined investment. It works such as a fund that is mutual allowing both big and small investors to own a shares of real estate.
But because they receive unique taxation considerations, REITS can trade at higher stock market prices, and so typically offer investors yields that are high.
GLPI, formed in November 2013, is just a spin-off of Penn National Gaming and owns 21 casino and racino properties across the United States, such as the Penn National Race Course in Grantville, Pennsylvania. It currently trades on the NASDAQ.
‘ This is a transaction that is compelling unlocks the value of Pinnacle’s real-estate assets and delivers substantial value to our investors,’ said Anthony Sanfilippo, CEO of Pinnacle Entertainment.
‘In addition, Pinnacle investors need the chance to benefit from running a bigger, more diversified REIT. As a premier operator of casino, entertainment and resort properties, Pinnacle will stay to boost its operating efficiency, expand property level margins and pursue development opportunities that leverage the Company’s proven administration and development skills.’
Chinese Stock Market Tumble Could Influence Macau Casinos
China’s largest stock market fell by 8.5 % on Monday, continuing a trend of volatility. Could Macau’s casinos have the effect? (Image: company.financialpost.com)
The stock that is chinese declined by a stressing 8.5 per cent on Monday, after a day’s panic selling resulted in dropping rates across the board. It ended up being a meeting that had a ripple influence on markets around the world, and one which could fundamentally hurt the chances for a smooth data recovery in Macau.
The drop in the Shanghai Composite Index ended up being undoubtedly massive. For the sense of viewpoint, it was the equivalent to something like a 1,500-point drop in the Dow Jones Industrial Average.
The thing that was most surprising was that the fall wasn’t the effect of a news that is shocking or an especially devastating pair of economic indicators. Instead, it appeared to be just a later date in just what has been an extremely volatile thirty days for the Chinese stock exchange.
Drop Follows Government-Funded Rally
The fall comes after a 16 percent rally that began on July 8, if the government that is chinese a rescue package designed to help keep stock prices afloat. But on Monday, that support no further seemed become there.
Either the federal government had stopped using steps to balance sell requests, or they couldn’t match the overwhelming wide range of sell offs that were using place, but whatever the main reason, it had beenn’t a good day.
Along with spending about $800 billion to prop the stock market up, the Chinese government has had many other actions within the last two weeks in an endeavor to stop the offering trend. Short-selling was restricted, some big shareholders were banned from offering stock, some companies stopped trading totally, and IPOs were suspended.
The fact that some popular government rescue fund purchases, such as PetroChina, saw big dips on your day suggested that the government purchases had either slowed or stopped. Whether this was a measure that is temporary see if the market could support it self or a sign of moving strategies is unclear.
The result was dramatic, and didn’t stop at the Chinese borders in any case. The dropping market and concerns indian dreaming slot that China’s growth is slowing may have been among the leading reasons for a drop in American stock areas early Monday early morning as well, while commodity rates such as oil also fell on worries about international growth.
Stock Market Not as Critical to Economy in Asia
However, the impact of the stock market decline may perhaps not be as broad or sharp as it would be if a tumble that is similar spot in the us. While tens of Chinese citizens have investments in the stock market, that’s nevertheless a small % associated with country as a entire, and the stock exchange isn’t considered a leading financial indicator in Asia since it is in the us.
This means that analysts believe the impact of even a drop that is drastic the market is going to be muted. And despite the turmoil, relationship prices were actually barely impacted. But that doesn’t mean that Macau will not feel some impact from the tumultuous stock market.
Those who are invested in China tend to be wealthy: exactly the mainland clients that Macau casinos are looking to attract as higher-end or even VIP players for one thing. And if you have a follow-up impact on the Chinese economy as a whole, that could be a devastating blow to Macau’s gaming industry, which is hoping that over time, the mass market may help replace with the shortage of high rollers after the Chinese government’s corruption crackdown on the year that is past.
No doubt gaming operators with vested interests in Macau’s casino economy were doing some knuckle-biting that is serious the Chinese currency markets news came in. And no question they will be keeping an eye that is close the trends continue steadily to unfold in coming weeks.
GVC Moves All-in for $1.5 Billion in Battle for Bwin.Party
GVC CEO Kenneth Alexander said he had been ‘very astonished’ whenever the bwin.party board chose to reject his Amaya-backed proposal. Now the company is back with an offering that is new. (Image: Tony Larkin/sbcnews.co.uk)
GVC Holdings has forced ahead a shock bid of almost £1 billion ($1.55 billion) for bwin.party, this time without the assistance that is financial of Inc.
Instead, GVC, that includes a market cap just one-third of bwin’s, has nailed straight down funding for the proposed takeover through a $443 million secured loan from US private equity group Cerberus Capital.
With the move, GVC trounces a bid from 888 Holdings that was thought to maintain the case by almost $100 million, which begs the question: will 888 bite back?
There is without doubt that the bwin.party board likes the basic idea of an 888 takeover. With various synergies between the two organizations, particularly in regulated markets, that hookup would probably facilitate integration and create expense savings further down the line.
Amaya Out From the Picture
Bwin.party ultimately rejected the first GVC/Amaya bid of £908 million ($1.41 billion), which proposed dividing the sports book and the poker operation between these two suitors, it was the riskier proposal because it felt.
The GVC/Amaya offer was £10 million more than 888’s, but this ended up being dismissed as no more than a ‘modest incremental premium’ by the bwin board.
‘ I was really astonished when [bwin] made that choice,’ Kenneth Alexander, chief executive of GVC, told London’s Financial Times on Monday. ‘888 were there and we had been not quite there, but we were progressing well. We would have got there but the decision was taken by them they took.’
Rumors began circulating the other day that GVC was looking for an investor to finance a solo bid, truncating Amaya, therefore simplifying the equation.
This brand new dynamic, combined with significantly sweetened pot, is possibly tempting to bwin’s shareholders.
High Stakes
Bwin, which had already recommended the 888 bid to shareholders and appeared to be moving forward with the deal, had clearly caught wind for the rumors when it announced over the that it was still open to offers weekend.
‘The board has suggested an offer from 888 and we are working towards getting that done,’ a Bwin spokesman said. ‘Should GVC or anyone else put forward an appealing, fully financed and offer that is deliverable of course the board will contemplate it against 888’s present offer.’
Bwin itself, however, might have been surprised by the scale of the bid that is new since many analysts speculated that GVC would struggle to improve the capital necessary to trump 888. But now, as the battle for bwin escalates into a raising war, insiders are fully expecting a counter-proposal.
And the stakes might be high for 888. The company only recently survived a takeover bid from Ladbrokes, and, as a period of consolidation turns into a prerequisite for the gambling industry in great britain and Europe, failure right here you could end up a reinstatement of those, or similar, negotiations.
