American casino operator Penn National Gaming Incorporated is set to almost double its casino estate in the southern state of Mississippi after agreeing deals that will see it spend $44 million in order to acquire the Resorts Casino Tunica property along with the nearby Bally’s Casino Tunica.
Wyomissing-based Penn National Gaming Incorporated already runs the Boomtown Casino Biloxi and the Hollywood Casino Gulf Coast in southern Mississippi along with the Hollywood Casino Tunica and revealed that the agreements with current owners RIH Acquisitions MS I and RIH Acquisitions MS II are expected to close during the second quarter of the year subject to the receipt of approvals from the Mississippi Gaming Commission.
After completing the Tunica County deals, Penn National Gaming Incorporated explained that it intends to lease the newly-acquired properties from its Gaming And Leisure Properties Incorporated real estate spin-off for an initial combined annual rent of $9 million.
“We are pleased to partner with Gaming And Leisure Properties [Incorporated] to structure this tuck-in transaction, which will be immediately accretive to our operating results upon closing,” read a statement from Timothy Wilmott, President and Chief Executive Officer for Penn National Gaming Incorporated. “The acquisition will add two complementary casinos to our existing Hollywood Casino Tunica operations thereby presenting Penn National [Gaming Incorporated] with the opportunity to benefit from a centralized local management structure.”
Bally’s Casino Tunica is located only about 34 miles from downtown Memphis, Tennessee, and features a steakhouse, buffet restaurant, 24-hour cafe and a live entertainments venue while its 40,000 sq ft casino offers some 947 slots as well as 16 table games.
For its part, the Resorts Casino Tunica, which is located next door to the Hollywood Casino Tunica, similarly offers a steakhouse, buffet restaurant and 24-hour cafe while additionally featuring a 201-room hotel, 18,000 sq ft of meetings and events space and a 35,000 sq ft casino complete with 800 slots and nine table games.
“We intend to make modest cap-ex investments at the newly-acquired casinos to elevate the guest experience while implementing our Marquee Rewards player loyalty program to allow guests to access Penn National [Gaming Incorporated’s] growing portfolio of properties including our Tropicana Las Vegas resort,” read the statement from Wilmott.
Penn National Gaming Incorporated already operates 27 facilities in 16 American states and Canada and explained that the Resorts Casino Tunica and the Bally’s Casino Tunica last year generated combined annual adjusted earnings before interest, tax, depreciation and amortization of about $21 million. However, the Mississippi pair’s gross casino revenues have shrunk by approximately 44% over the previous decade from a high of $1.66 billion in 2006 to $932.5 million in 2016.