Game Types Bonuses Slots More
Online Casinos Poker Bingo Games Lotteries Sports & Racebooks Fantasy Sports Forex Betting Exchanges Spread Betting Binary Options Live Dealers
Weekly Newsletter Online Gaming News Payment Methods Gaming Software Gaming Site Owners Gaming Jurisdictions Edit Preferences Search

Penn National to Sell Argosy Casino-Baton Rouge

21 Jun 2005

WYOMISSING, Pennsylvania -- (PRESS RELEASE) -- Penn National Gaming, Inc. (PENN: Nasdaq) announced today that it has entered into an agreement with a subsidiary of Columbia Sussex Corporation whereby immediately subsequent to the completion of the merger of Penn National and Argosy Gaming Company (AGY: NYSE), Argosy Gaming Company and the Columbia Sussex unit will execute a securities purchase agreement. Under the securities purchase agreement, the Columbia Sussex unit will purchase the Argosy Casino-Baton Rouge casino property from Argosy Gaming Company (which would then be a wholly owned subsidiary of Penn National) for $150 million in cash. The Columbia Sussex Corporation subsidiary has provided a $15 million deposit toward the purchase price. Columbia Sussex Corporation has guaranteed the financing for the transaction. The sale of Argosy Casino-Baton Rouge is subject to the completion of the Penn National/Argosy Gaming merger, purchase price adjustments, other customary closing conditions and regulatory approvals.

Penn National Gaming previously reported that it was continuing to work with various state gaming boards and the Federal Trade Commission to obtain their required approvals to complete the Argosy Gaming Company transaction and that it elected to divest Argosy Casino-Baton Rouge to expedite securing necessary approvals. Penn National expects to complete the Argosy Gaming transaction in the third quarter of 2005.

The value of the transaction represents a multiple of approximately 8.2 times and 7.4 times Argosy Casino-Baton Rouge's EBITDA (earnings before interest, taxes, depreciation and amortization) for the twelve month periods ended December 31, 2004 and March 31, 2005, respectively.

Argosy Casino-Baton Rouge features a three-level riverboat casino, with over 870 slot machines and 30 table games, a 300-room Sheraton hotel, four food and beverage outlets, 40,000 square feet of meeting space and approximately 150,000 square feet of leasable retail space.

Penn National intends to use the approximately $125 million in net after-tax proceeds from the sale to reduce debt. The property will be reported as assets held for sale until closing.

Bear, Stearns & Co. Inc. acted as exclusive financial advisor to Penn National in connection with this transaction. Libra Securities, LLC acted as exclusive financial advisor to Columbia Sussex in connection with this transaction.

About Us | Advertising | Publications | Land Casinos