GLPI Acquires Pinnacle Properties in $4.74 Billion Deal

GLPI Ac<span id="more-6069"></span>quires Pinnacle Properties in $4.74 Billion Deal

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

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

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

Under the terms of the deal, Pinnacle’s running unit and the real home of Belterra Park Gaming & Entertainment are going to be spun off into a separately traded company that is public as OpCo, while GLPI will get the real estate assets of the remaining company, PopCo.

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

The enlarged group will form a powerhouse real estate investment trust which will own 35 casino and hotel facilities in 14 states, the third-largest publicly traded triple-net REIT into the world.

Pinnacle’s Achievements

Pinnacle traces its history back to 1938, when Jack L Warner launched 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 offered 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 size.

‘Pinnacle’s real estate profile brings great properties to GLPI and adds one of this leading gaming operators as being 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 works such as a fund that is mutual allowing both large and small investors to own a shares of real estate.

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

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

‘ This is a compelling transaction that 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 shareholders could have the opportunity to benefit from having a larger, more diversified REIT. As a premier operator of casino, resort and activity properties, Pinnacle will continue to enhance its working efficiency, expand property degree margins and pursue growth 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 impact? (Image: business.financialpost.com)

The stock that is chinese declined by a stressing 8.5 percent on Monday, after a day’s panic selling resulted in falling prices across the board. It ended up being a conference which had a ripple effect on markets around the world, and the one that could finally hurt the possibilities for a recovery that is smooth Macau.

The drop within the Shanghai Composite Index had been truly massive. For a sense of viewpoint, it was very same to something like a 1,500-point drop in the Dow Jones Industrial Average.

What was most surprising was that the drop was not the effect of a shocking news event or a really devastating pair of financial indicators. Instead, it appeared to be just a later date in what has been an extremely volatile thirty days for the Chinese stock market.

Drop Follows Government-Funded Rally

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

Either the us government had stopped using actions to balance sell requests, or they couldn’t maintain the overwhelming quantity of sell offs that have been using place, but whatever the main reason, it had beenn’t a good day.

Along with spending about $800 billion to prop the stock market up, the Chinese government has had many other actions over the past two weeks in an attempt to stop the offering trend. Short-selling was limited, some shareholders that are large banned from attempting to sell stock, some companies stopped trading totally, and IPOs were suspended.

The 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 it self or a sign of shifting strategies 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 growth is slowing could have been among the best factors behind a fall in American stock markets early Monday early morning as well, while commodity prices such as oil also fell on concerns about global growth.

Stock Market Not as Critical to Economy in Asia

However, the effect of the stock market decline may perhaps not be as broad or sharp as it would be if a tumble that is similar destination in america. While tens of Chinese citizens have investments in the stock market, that’s nevertheless a small % of the country as a whole, and the stock market isn’t considered a leading economic indicator in Asia because it is in America.

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

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 play indian dreaming slot on the Chinese economy as being a whole, that may be a devastating blow to Macau’s gaming industry, which is hoping that as time passes, the mass market helps replace the lack of high rollers after the Chinese government’s corruption crackdown over the past 12 months.

No doubt video gaming operators with vested interests in Macau’s casino economy were doing some knuckle-biting that is serious the Chinese currency markets news arrived in. And no doubt 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 was ‘very astonished’ whenever the bwin.party board thought we would reject his Amaya-backed proposal. Now the company is back with a new offering. (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 through a $443 million loan that is secured US private equity group Cerberus Capital.

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

There is no doubt that the bwin.party board likes the basic idea of an 888 takeover. With various synergies involving the two organizations, particularly in regulated markets, that hookup would probably facilitate integration and create expense cost savings further down the line.

Amaya Out of the Picture

Bwin.party ultimately rejected the initial 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 very 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 there, but we were progressing well. We would have got there but the decision was taken by them they took.’

Rumors began circulating week that is last GVC was in search of an investor to finance a solo bid, truncating Amaya, hence simplifying the equation.

This brand new dynamic, combined 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 going forward with the offer, had plainly caught wind associated with rumors when it announced within the weekend that it was nevertheless open to offers.

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

Bwin itself, however, might have been surprised by the scale of the brand new bid, since numerous analysts speculated that GVC would struggle to enhance the capital necessary to trump 888. But now, as the battle for bwin escalates into a war that is raising insiders are fully expecting a counter-proposal.

And the stakes could possibly be high for 888. The company only recently survived a takeover bid from Ladbrokes, and, as a period of consolidation becomes a prerequisite for the gambling industry in great britain and European countries, failure here could cause a reinstatement of those, or similar, negotiations.

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