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US – Boyd to buy four Penn properties

By - 19 December 2017

Boyd Gaming has entered into a definitive agreement with Penn National Gaming to acquire the operations of Ameristar St. Charles (Missouri); Ameristar Kansas City (Missouri); Belterra Casino Resort in Florence, Indiana; and Belterra Park in Cincinnati, Ohio.

The acquisition of these assets is in connection with Penn National’s proposed acquisition of Pinnacle Entertainment.

Under terms of the agreement, Boyd Gaming will pay total cash consideration of $575m to acquire the four assets, representing a multiple of 6.25 times projected EBITDA before synergies. The Company expects the transaction to be free cash flow positive and immediately accretive to earnings.

“This transaction is a compelling opportunity to diversify and expand our nationwide portfolio into new markets at an attractive price,” said Keith Smith, President and Chief Executive Officer of Boyd Gaming. “By adding these four high-quality, well-maintained assets to our portfolio, we will gain strong positions in three of the largest metropolitan areas in the Midwest. This transaction will expand our Company’s size and scale, grow our customer base, and further enhance our substantial free cash flow profile.”

As part of the transaction, Boyd Gaming will enter into a master lease agreement with Gaming and Leisure Properties, which owns the real estate of Ameristar St. Charles, Ameristar Kansas City and Belterra Casino Resort. GLPI has entered into an agreement to purchase the real estate of Belterra Park from Penn National, and Belterra Park’s real estate will be leased to Boyd Gaming as part of Boyd Gaming’s master lease agreement with GLPI. The terms of Boyd Gaming’s lease agreement will be substantially similar to Pinnacle’s current master lease with GLPI.

Boyd Gaming expects the transaction to close in the second half of 2018, subject to the satisfaction of customary closing conditions and the receipt of all required regulatory approvals.

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