Penn National Gaming announced today the company would be re-entering the market in Maryland as it entered into a definitive agreement with the real estate investment trust (REIT) Gaming and Leisure Properties (GLPI) to acquire the operations of Hollywood Casino Perryville.
“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.”Jay Snowden, President and CEO, Penn National
Penn Acquires Operations, Pays Rent
Subject to customary working capital adjustments, upon closing of the transaction Penn will acquire the operations of the casino for $31.1 million in cash and will pay approximately $7.77 million of rent annually through a lease agreement it signed with GLPI for the real estate assets associated with the Hollywood Casino Perryville.
The acquisition of the operations at Hollywood Casino Perryville will expand Penn National’s footprint across US, making the total number of states where the casino operator is present to 20. The closing of the transaction is subject to approval of the state regulator, the Maryland Lottery and Gaming Commission, as well as other customary closing conditions, and is expected to happen in mid-2021.
Sports Betting Legalization in Maryland
Maryland was among the states whose residents voted for different forms of gambling expansion along with the Presidential Elections. On the referendum, Marylanders overwhelmingly supported the legalization of sports betting in the state, setting the wheel in motion for lawmakers to pass the appropriate sports betting bill and establish the regulatory framework of the market.
“In addition, with the recent approval of sports betting through the overwhelming passage of Question 2 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.”Jay Snowden, President and CEO, Penn National
For GLPI, the conditional agreement re-affirms the business model adopted by the REIT in which it owns the real estate and enters into lease agreements with casino operators.
Earlier this month, GLPI entered into an agreement for the operations of another gaming property it owns, Belle of Baton Rouge riverboat casino and hotel in Louisiana, in which the parent of Illinois-based Casino Queen, CQ Holding Company, acquired operations at the property from Caesars Entertainment for an undisclosed fee.