GLPI Acquires Pinnacle Properties in $4.74 Billion Deal



Anthony Sanfilippo, CEO of Pinnacle Entertainment: ‘ This will be a transaction that is compelling unlocks the value of Pinnacle’s real-estate assets and delivers substantial value to our shareholders.’

Gaming and Leisure Properties Inc (GLPI), the gambling industry’s first estate that is real trust (REIT), will get all of Pinnacle Entertainment’s property’s assets in an all-stock transaction that values the holdings at $4.74 billion.

Pinnacle rebuffed a GLPI offer in March worth $4.1 billion.

Underneath the terms of the free slot machine indian dreaming deal, Pinnacle’s running product and the real home of Belterra Park Gaming & Entertainment are going to be spun off as a separately traded company that is public as OpCo, while GLPI will get the real estate assets of the residual business, PopCo.

Pinnacle shareholders will own roughly 27 per cent of the combined business and 100 % of OpCo.

The group that is enlarged form a powerhouse real estate investment trust that may own 35 casino and resort 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 size.

‘Pinnacle’s real estate portfolio brings great properties to GLPI and adds one for the leading gaming operators as 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 more powerful as we pursue long-term growth.’

The REIT Stuff

A REIT is really a ongoing company that purchases property through combined investment. It really works just like a shared fund, allowing both big and small investors to own a shares of real estate.

But because they receive unique tax considerations, REITS can trade at higher stock market prices, and so typically offer investors high yields.

GLPI, formed in November 2013, is just a spin-off of Penn nationwide Gaming and owns 21 casino and racino properties across the United States, including the Penn nationwide Race Course in Grantville, Pennsylvania. It currently trades on the NASDAQ.

‘ This is a transaction that is compelling unlocks the worth of Pinnacle’s real-estate assets and delivers substantial value to our shareholders,’ said Anthony Sanfilippo, CEO of Pinnacle Entertainment.

‘In addition, Pinnacle investors may have the chance to benefit from running a bigger, more diversified REIT. As a premier operator of casino, resort and activity properties, Pinnacle will continue to improve its running efficiency, expand home degree margins and pursue development opportunities that leverage the Company’s proven management and development skills.’

Chinese Stock Market Tumble Could Impact Macau Casinos

Asia’s largest stock market dropped by 8.5 percent on Monday, continuing a trend of volatility. Could Macau’s casinos have the effect? (Image: business.financialpost.com)

The Chinese stock market declined by a worrying 8.5 % on Monday, after a day of panic selling resulted in falling rates across the board. It ended up being an event which had a ripple influence on markets around the world, and one that could finally hurt the chances for a smooth data recovery in Macau.

The drop within the Shanghai Composite Index ended up being undoubtedly massive. For a sense of perspective, it was the same to something like a drop that is 1,500-point the Dow Jones Industrial Average.

What was most astonishing was that the fall was not caused by a news that is shocking or a really devastating set of economic indicators. Instead, it showed up to be just a later date in what has been an increasingly volatile month for the Chinese currency markets.

Drop Follows Government-Funded Rally

The drop comes after a 16 percent rally that started on July 8, when the Chinese government enacted a rescue package designed to keep stock prices afloat. But on that support no longer seemed to be there monday.

Either the government had stopped using actions 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 ended up beingn’t a good day.

Along with spending about $800 billion to prop the stock market up, the Chinese government has brought a number of other actions in the last two weeks in an effort to stop the offering trend. Short-selling was limited, some shareholders that are large banned from selling stock, some companies stopped trading completely, and IPOs were suspended.

The fact that some government that is popular fund purchases, such as PetroChina, saw big dips on the afternoon suggested that the government purchases had either slowed or stopped. Whether this was a short-term measure to see if the market could support it self or a sign of shifting techniques is unclear.

The result was dramatic, and didn’t stop at the Chinese borders in any case. The falling market and concerns that China’s development is slowing might have been among the key reasons for a drop in American stock areas early Monday morning as well, while commodity rates such as oil additionally fell on concerns about global development.

Stock Market never as Critical to Economy in Asia

However, the effect of the stock market decline may not be as broad or sharp because it would be if a tumble that is similar place in the United States. While tens of Chinese citizens have investments into the stock market, that’s still half the normal commission associated with nation being a entire, and the currency markets isn’t considered a leading indicator that is economic Asia because it is in the us.

This means that analysts believe the effect of even a drastic drop in the market will be muted. And despite the turmoil, bond prices were really barely impacted. But that does not mean that Macau will not feel some effect from the stock market that is tumultuous.

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 would be a devastating blow to Macau’s gaming industry, which is hoping that over time, the mass market helps make up for the lack of high rollers following a Chinese government’s corruption crackdown over the past 12 months.

No doubt gaming operators with vested interests in Macau’s casino economy were doing some knuckle-biting that is serious the Chinese stock market news came in. With no doubt they will be keeping a close eye as the trends continue 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 made a decision to reject his Amaya-backed proposal. Now the business is back with an offering that is new. (Image: Tony Larkin/sbcnews.co.uk)

GVC Holdings has pressed ahead a shock bid of almost £1 billion ($1.55 billion) for bwin.party, this time without the financial assistance of Amaya Inc.

Instead, GVC, that includes a market cap just one-third of bwin’s, has nailed straight down funding for the proposed takeover via a $443 million loan that is secured US personal equity group Cerberus Capital.

With the move, GVC trounces a bid from 888 Holdings that was thought to be in the case by almost $100 million, which begs the question: will back 888 bite?

There is without doubt that the bwin.party board likes the idea of an 888 takeover. With various synergies involving the two businesses, particularly in regulated markets, that hookup may likely facilitate integration and create cost savings further down the line.

Amaya Out From the Picture

Bwin.party ultimately rejected the original GVC/Amaya bid of £908 million ($1.41 billion), which proposed dividing the sports book and the poker procedure between these two suitors, because it felt it was the riskier proposal.

The GVC/Amaya offer was £10 million more than 888′s, but this was dismissed as no more than a ‘modest incremental premium’ by the board that is bwin.

‘ I happened to be really astonished when [bwin] made that decision,’ Kenneth Alexander, chief executive of GVC, told London’s Financial Times on Monday. ’888 were there and we were 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 last week that GVC was looking an investor to finance a solo bid, truncating Amaya, therefore simplifying the equation.

This new powerful, along with the considerably sweetened pot, is possibly tempting to bwin’s shareholders.

High Stakes

Bwin, which had already recommended the 888 bid to shareholders and appeared become going forward with the offer, had clearly caught wind associated with rumors when it announced on the that it was still open to offers weekend.

‘The board has recommended an offer from 888 and we are working towards getting that done,’ a Bwin spokesman stated. ‘Should GVC or anyone else put forward an appealing, fully financed and offer that is deliverable of course the board will consider it against 888′s present offer.’

Bwin itself, however, might have been astonished by the scale of the brand new bid, since numerous analysts speculated that GVC would struggle to raise the money necessary to trump 888. Nevertheless now, as the battle for bwin escalates into a war that is raising 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 necessity for the gambling industry in the UK and European countries, failure here could result in a reinstatement of those, or similar, negotiations.

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