Penn National Wins Auction Licence

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Mountainview Thoroughbred Racing Association, which is a subsidiary of regional casino operator Penn National Gambling (PNG), won the first out of 10 possible Category 4 casino licenses, as announced by Pennsylvania Gaming Control Board on Wednesday. PNG paid $50.1m for the license, which is well above the starting bid of $7.5m. PNG’s participation in the auction was a surprise considering their opposition to the satellite casino plans. Furthermore, the company filed a lawsuit this week to overturn the gambling expansion law, which the state passed last year.

PNG opposed the law passed as it prohibits the building of the mini-casinos within a 25-mile radius of the state’s existing 12 brick and mortar casinos. Winning the bid permits PNG to select the site for its Category 4 venue. The company has opted for an area of York County, an hour from Hollywood. The chosen site impedes competitors from operating on Hollywood’s turf. Eric Schippers, PNG’s vice president for public affairs, told Philly.com that the company’s decision strategy is to have “one eye on defense, one eye on offense.” PNG plans to use every resource to ensure that the new venue is lucrative and no competitors may penetrate the Hollywood area.
PNG is of the opinion that the new venue will be profitable.

Licence

PNG’s outstanding payment of $50.1m needs to be submitted by Friday, thereafter, the company has six months to file its license application, stating the location of the new venue. PNG has been conferred the option to add 30 gaming tables to the slot license at an additional $2.5m. PNG will have a further option to add another 10 tables after the first year of operation.

In its lawsuit, PNG accused the state of violating its constitutional protections to equal protection under the law and due process. If PNG’s lawsuit claim is successful, the company will withdraw its bid to obtain the license. PNG feels that the law of Pennsylvania is unjust and the company will strive to generate high revenue in the new Hollywood venue. Pennsylvania’s next mini-casino auction will take place on the 24th of January.

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