Stock Market Watch

Penn National Gaming – PENN – Agreement with State of Ohio Regarding the Relocation of Its Two Racetracks

by ·


Penn National Gaming, Inc. (Nasdaq: PENN) announced it has reached an agreement with the State of Ohio that will help pave the way toward the relocation of its two Ohio racetracks and the development of new approximately $200 million racetrack/video lottery terminal (VLT) facilities (inclusive of a $50 million license fee) in Dayton and in Austintown (located in the Mahoning Valley).

The non-binding Memorandum of Understanding (MOU) between the Company and the office of Ohio Gov. John Kasich requires Penn National to pay a $75 million relocation fee per VLT facility within 180 days after each facility opens. Penn National previously announced its intent to relocate Beulah Park from the Columbus suburb of Grove City to Austintown and Raceway Park from Toledo to Dayton. The MOU contemplates Penn National paying the State 33.5% from VLT revenues as well as a yet to be determined amount to the Ohio horse racing industry. Talks between PENN and the thoroughbred and harness horsemen’s organizations are ongoing. In addition, the agreement restricts any other gaming facility from being located within 50 miles of Penn National’s Columbus and Toledo casinos, as well as its relocated tracks, with certain exceptions.

“This agreement is a significant step toward the development of two new first-class racing and gaming facilities that will create thousands of construction jobs and more than 3,000 direct and indirect jobs, and bring the excitement of horse racing and VLTs to two areas of the state that are now underserved with this type of entertainment option,” said Tim Wilmott, President and Chief Operating Officer of PENN.


“We appreciate the efforts of the Governor’s Office in allowing us to reach this milestone and the administration’s commitment to helping us gain the remaining approvals for relocating our Ohio racetracks,” Wilmott said. “We’re also appreciative for the support of the legislative delegations from Dayton and the Mahoning Valley as well as the local elected officials and local business communities there.”

The MOU assumes final state authorization of VLTs at Ohio racetracks and a favorable resolution of the current litigation challenging the establishment of VLT facilities in Ohio. In addition, the MOU is expressly conditioned on a definitive agreement with representatives of the thoroughbred and harness horsemen that is satisfactory to PENN and approved by the Racing Commission.

In the agreement, PENN reiterates its previous commitment to give those employees of Beulah Park and Raceway Park impacted by the closing of the tracks priority in applying for jobs at the Company’s two new casinos in Columbus and Toledo, both of which are scheduled to open this year.

More Posts by this author

edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.


Tags:

Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

You may also like...