Eldorado Resorts now owns Lumiere Place, though GLPI will hold a lien on the casino for 2 to 5 more years.
Penn National Gaming closed its buyout of Pinnacle Entertainment this month, after some reshuffling to assure state regulators in Missouri. The sale brought one of Penn National’s subsidiarius ownership of River City Casino in Lemay, while the company already owns Casino Argosy Alton and Hollywood Csaino in Maryland Heights.
The official owner is Gaming & Leisure Properties Inc. (GLPI) of Wyomissing, Pennsylvania. GLPI is a 2013 spinoff of Penn National Gaming, which was designed as a real estate investment trust (REIT) to woo investors. Gaming and Leisure Properties now owns 44 casino properties, while directly managing 2 of the 44 casinos.
The buyout of Pinnacle Gaming was announced earlier this year, but GLPI had to clear several regulatory hurdles to avoid a local monopoly. The deal makes the GLPI one of the biggest casino owners in America.
GLPI and Eldorado Entertainment had to shift a significant amount of assets to please Missouri regulators. The were not happy that one company would own or hold the lease on 5 out of 6 St. Louis area casinos. The only casino not involved in the Penn National-GLPI-Pinnacle deal is Casino Queen, which still is owned by CQ Holding Company.
Ameristar St. Charles Bought by Boyd Gaming
To close the deal, GLPI agreed to sell the top-grossing casino in the area — Pinnacle’s Ameristar St. Charles — to Boyd Gaming Corp out of Las Vegas. The Ameristar St. Charles was only part of the deal, because GLPI sold casinos in Indiana and Ohio to Boyd Gaming in the same divestiture.
That divestiture brought back $563 million to Gaming & Leisure Properties. It means GLPI will own four St. Louis casinos, while it holds the lien for several years on another casino. In the end, Boyd Gaming and Eldorado Resort will be GLPI’s business competitors in the region.
Lumiere Place Goes to Eldorado
GLPI also agreed to lend Eldorado Resorts $246 million, so it coucl purchase Lumiere Place’s real estate. GLPI will continue to hold a lien on Lumiere Place on a loan due in two years. Three 1-year extensions on the lien are possible.
That means Eldorado, which is based in Reno, should own Lumiere Place in 2 to 5 years, but under no circumstances can Eldorado sell the casino to a third party within that time. It also means that Gaming & Leisure properties can go ahead with its plans for the rest of St. Louis’s casinos.
Eldorado Buys Tropicana
The various moves continue a period of consolidation in the American land-based casino market. Eldorado Resorts finalized another big purchase earlier this month. Eldorado purchases Tropicana Entertainment from billionaire Carl Icahn for $1.85 billion earlier this year.
That deal was finalized earlier this month. Lumiere Place originally was owned by Tropicana. The original plan was for GLPI to buy all of Tropicana’s properties for $1.21 billion, then lease the properties to a variety of casino companies. Part of GLPI’s business is leasing gaming properties to casino management firms.
Missouri’s gaming regulators balked at that part of the deal. Owning most of St. Louis’s casinos and leasing the rest to competitors looked suspicious to the Missouri Gaming Commission.
St. Louis Casino Operators
Now that the deal is finalized, St. Louis has four casino ownership groups. Penn National owns Argosy, Hollywood, and River City. Eldorado Resorts owns Lumière Place, though GLPI still holds the lien on the property. Boyd Gaming now owns Ameristar. Finally, CQ Holding Company owns Casino Queen.
Penn National Gaming is expanding in its home state of Pennsylvania, too. After Pennsylvania approved up to 10 new land-based satellite casinos last year, Penn National won the right to build two separate satellite casinos in the state. It also paid $10 million for an online casino and poker license in Pennsylvania, while it plans to purchase a sportsbook license for the state of Pennsylvania, if approved.
