RSS 2.0 FeedVol. 3, No. 7, July 2007, Global Gaming Roundup
Private Penn
Third-largest gaming company sold to investment firms
Penn National Chairman and CEO Peter Carlino will remain with the company following the purchase by a group of private equity firms.
The trend toward private equity purchases in the gaming industry continued last month when Penn National Gaming agreed to a $6.1 billion buyout offer from a group of public companies. The group of buyers are led by Fortress Investment Group LLC and Centerbridge Partners LP. It will also assume about $2.8 billion in Penn National’s outstanding debt.
Penn operates casinos in six states—Maine, New Mexico, Colorado, Pennsylvania, Illinois and Mississippi—as well as in Ontario, Canada. The company previously bought Hollywood Casinos and Argosy Gaming and has grown into the third-largest company in the gaming industry.
Penn’s management team has recommended that the board of directors accept the buyout.
“Since the company’s 1994 initial public offering, Penn National Gaming has transformed itself from the owner of a single racetrack into one of the premier gaming companies in America,” said Peter Carlino, CEO of Penn National. “Fortress and Centerbridge are both leading private equity firms with proven track records and strong reputations. This is a very attractive valuation for our shareholders, at a time when the financial markets are recognizing the strong investment rationale for gaming companies.”
Penn National’s senior management team, Carlino, Chief Financial Officer William Clifford and Executive Vice President of Operations Leonard DeAngelo, as well as other key members of Penn National’s corporate team and property-level management are expected to stay on.
The deal to buy Penn National continues a trend in the industry toward private ownership. The largest deal has Harrah’s Entertainment being purchased by two private equity groups, Apollo Management and Texas Pacific. The company is now seeking approvals from the regulatory bodies in the jurisdictions in which it operates.
Last year, Station Casinos completed a private buyout led by the management team of Frank and Lorenzo Fertitta and financed in part by Colony Capital, a private equity company that has several other casino investments.
The trend toward private equity purchases in the gaming industry continued last month when Penn National Gaming agreed to a $6.1 billion buyout offer from a group of public companies. The group of buyers are led by Fortress Investment Group LLC and Centerbridge Partners LP. It will also assume about $2.8 billion in Penn National’s outstanding debt.
Penn operates casinos in six states—Maine, New Mexico, Colorado, Pennsylvania, Illinois and Mississippi—as well as in Ontario, Canada. The company previously bought Hollywood Casinos and Argosy Gaming and has grown into the third-largest company in the gaming industry.
Penn’s management team has recommended that the board of directors accept the buyout.
“Since the company’s 1994 initial public offering, Penn National Gaming has transformed itself from the owner of a single racetrack into one of the premier gaming companies in America,” said Peter Carlino, CEO of Penn National. “Fortress and Centerbridge are both leading private equity firms with proven track records and strong reputations. This is a very attractive valuation for our shareholders, at a time when the financial markets are recognizing the strong investment rationale for gaming companies.”
Penn National’s senior management team, Carlino, Chief Financial Officer William Clifford and Executive Vice President of Operations Leonard DeAngelo, as well as other key members of Penn National’s corporate team and property-level management are expected to stay on.
The deal to buy Penn National continues a trend in the industry toward private ownership. The largest deal has Harrah’s Entertainment being purchased by two private equity groups, Apollo Management and Texas Pacific. The company is now seeking approvals from the regulatory bodies in the jurisdictions in which it operates.
Last year, Station Casinos completed a private buyout led by the management team of Frank and Lorenzo Fertitta and financed in part by Colony Capital, a private equity company that has several other casino investments.
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