Canada – Great Canadian Gaming secures rights to East Gaming BundleBy Phil - 14 September 2015
Great Canadian Gaming’s joint venture Ontario Gaming East Limited Partnership has won the right to operate gaming facilities in OLG’s Gaming Bundle 2 East.
The East Gaming Bundle contains three gaming zones. The first gaming zone includes the township of Cavan Monaghan, the City of Peterborough and surrounding areas, and is currently served by OLG Slots at Kawartha Downs. The second gaming zone includes a new build opportunity to service the City of Belleville and the municipality of Quinte West. The third gaming zone includes the City of Kingston and surrounding areas, including Gananoque and Leeds and Thousand Islands, and is currently served by OLG Casino Thousand Islands. Additional details about the current and planned scopes of the gaming operations in these zones are included in a supplemental schedule to this release.
Ontario Gaming East LP will acquire all of OLG’s gaming assets in the East Gaming Bundle, including OLG Casino Thousand Islands and the slot operations within leased space at Kawartha Downs. The purchase price is $37.4m plus cash of approximately $13m to cover working capital.
Under the planned casino operating and services agreement, Ontario Gaming East LP will operate the gaming facilities in the bundle and will provide OLG a pre-established, guaranteed annual payment. In return, the Partnership will receive an annual fee comprised of, among other components, an annual base fee as well as 70 per cent of gross gaming revenue above the applicable pre-established amount for each year. Additional, specific details about the casino operating and services agreement and this planned financial arrangement are not permitted to be disclosed at this time under the terms of OLG’s procurement process.
Rod Baker, the Company’s President and Chief Executive Officer, said: “We thank OLG for the opportunity to participate in the modernization of gaming in Ontario and are both honoured and excited to have been awarded this first gaming bundle. Great Canadian has been involved in gaming in Canada since 1982 and in Ontario horse racing at our Flamboro Downs and Georgian Downs properties since 2005. We look forward to this next chapter in the Company’s history and the opportunity to collaborate with the OLG and local municipalities to provide exciting entertainment experiences for each of the communities of the East Gaming Bundle, which will include a new gaming and entertainment facility for the community of Belleville or Quinte West. We are very excited to welcome OLG employees at the existing locations and we look forward to working with them after the anticipated completion of the acquisition early next year.”