GLPI Acquires Pinnacle Properties in $4.74 Billion Deal

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GLPI Ac<span id="more-11781"></span>quires Pinnacle Properties in $4.74 Billion Deal

Anthony Sanfilippo, CEO of Pinnacle Entertainment: ‘ This will be a compelling transaction that 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 deal, Pinnacle’s operating unit and the actual property of Belterra Park Gaming & Entertainment are going to be spun off as a separately traded public company known as OpCo, while GLPI will get the real estate assets of the remaining company, PopCo.

Pinnacle investors will own roughly 27 percent of the combined company and 100 percent of OpCo.

The group that is enlarged form a powerhouse property investment trust that will own 35 casino and hotel 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 launched the Hollywood Park Racetrack.

Today it owns 15 casino properties throughout the US and in addition has a 26 percent stake in Asian Coast Development Ltd, the owner and developer for the Ho Tram Strip in Vietnam.

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 new properties to its profile and essentially doubling in dimensions.

‘Pinnacle’s real estate profile brings great properties to GLPI and adds one for the leading gaming operators being a brand new tenant,’ said Peter Carlino, Chairman and CEO of GLPI. ‘Pinnacle’s proven track record of continued improving operating performance will make GLPI even more powerful as we pursue long-term growth.’

The REIT Material

A REIT is just a ongoing company that buys property through combined investment. It really works such as for instance a mutual investment, allowing both large and small investors to own a shares of real estate.

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

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

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

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

Chinese Stock Market Tumble Could Influence Macau Casinos

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

The Chinese stock market declined by a worrying 8.5 percent on Monday, after a day of panic selling led to falling costs across the board. It had been a conference which had a ripple impact on markets around the world, and one that could finally hurt the opportunities for a smooth data recovery in Macau.

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

That which was most surprising was that the fall wasn’t the result of a shocking news event or an especially devastating group of economic indicators. Instead, it appeared to be just a later date in exactly what has been an ever more volatile thirty days for the stock market that is chinese.

Drop Follows Government-Funded Rally

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

Either the us government had stopped using steps to balance sell purchases, or they couldn’t match the overwhelming quantity of sell offs which were taking 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 many other actions in the last two weeks in an attempt to stop the selling trend. Short-selling was restricted, some big shareholders were banned from selling stock, some companies stopped trading totally, and IPOs were suspended.

The undeniable fact that some government that is popular fund purchases, such as PetroChina, saw big dips on your day suggested that the government purchases had either slowed or stopped. Whether this was a measure that is temporary see if the market could support itself or a sign of shifting strategies is confusing.

The result was dramatic, and didn’t stop at the Chinese borders in any case. The falling market and concerns that China’s growth is slowing may have been among the key causes of a drop in American stock markets early Monday early morning as well, while commodity prices such as oil additionally fell on concerns about worldwide development.

Stock Market Not as Critical to Economy in Asia

However, the impact of the stock market decline may perhaps not be as broad or sharp as it would be if a similar tumble took destination in the United States. While tens of Chinese residents have investments into the stock market, that’s nevertheless a small % associated with the country being a whole, and the stock market isn’t considered a leading indicator that is economic Asia because it is in the us.

Which means that analysts believe the impact of even a drop that is drastic the market may very well be muted. And despite the turmoil, relationship prices were actually barely impacted. But that does not mean that Macau won’t feel some impact from the tumultuous currency markets.

For one thing, those who find themselves committed to China tend to be wealthy: exactly the mainland clients that Macau gambling enterprises searching for to attract as higher-end or even VIP players. And if you have a follow-up impact on the Chinese economy as a whole, that may be a devastating blow to Macau’s gaming industry, which is hoping that in the long run, the mass market may help replace with the dearth of high rollers following a Chinese government’s corruption crackdown throughout 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 arrived in. With no question they’ll 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 surprised’ whenever the bwin.party board made a decision to reject his Amaya-backed proposal. Now the organization has returned with an offering that is new. (Image: Tony Larkin/sbcnews.co.uk)

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

Instead, GVC, with a market cap just one-third of bwin’s, has nailed straight down funding for the proposed takeover by way of 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 888 bite back?

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

Amaya Out of 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 had been 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 bwin board.

‘ I happened to be really astonished when [bwin] made that choice,’ Kenneth Alexander, chief executive of GVC, told London’s Financial Times on Monday. ‘888 were there and we had been not quite here, but we had been progressing well. We would have got there but they took your choice they took.’

Rumors began circulating week that is last GVC was looking an investor to fund 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 to be moving forward with the deal, had obviously caught wind associated with the rumors whenever it announced on the weekend that it ended up being nevertheless open to offers.

‘The board has suggested an offer from 888 and we are working towards getting that done,’ a Bwin spokesman said. ‘Should GVC or anyone else put forward an appealing, completely financed and offer that is deliverable of course the board will ponder over it against 888’s current offer.’

Bwin itself, however, might have been astonished by the scale of the bid that is new since numerous analysts speculated that GVC would struggle to improve the money necessary to trump 888. Nevertheless now, as the battle for bwin escalates into a raising war, 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 great britain and Europe, failure right here could result in a reinstatement of those, or similar, negotiations.

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