Both Penn and Boyd own properties in Las Vegas, so people in their players clubs (rewards programs) will be able to go there and use their points for hotel rooms, buffet meals and other perks, said Steve Bourie, a casino expert and publisher of the American Casino Guide for more than 25 years. Pinnacle had no properties in Las Vegas.
“A lot of people like to go there,” said Bourie, of Hollywood, Florida. “It’s a fun place to go if you’re a gambler. It’s a fun place to go even if you’re not a gambler. Some (River City and Ameristar customers) are probably going there now, but they’re not able to use their players club benefits.”
Penn is a Pennsylvania-based company that already owns Argosy Casino in Alton and Hollywood Casino St. Louis in Maryland Heights, Missouri, two of six casinos in St. Louis and the metro-east; and 27 other gaming properties across the country.
Penn plans to acquire Pinnacle’s 16 properties but then sell four of them in a separate, nearly $575 million deal with Boyd. The four are Ameristar St. Charles and Ameristar Kansas City, Belterra Casino Resort in Indiana and Belterra Park in Ohio.
Ownership changes must be approved by the Missouri Gaming Commission, according to its general counsel, Ed Grewach. Also, Boyd will have to apply for a Missouri casino license since it hasn’t been operating in the state.
“We go through a very thorough investigation process to determine if they’re suitable to hold a Missouri casino license,” Grewach said.
If the acquisition goes through, Penn will own 41 properties in 20 locations with 53,000 slot machines, 1,300 game tables, 8,300 hotel rooms and more than 35,000 employees, said Troy Stremming, Pinnacle executive vice president for government relations and public affairs.
This will benefit shareholders, customers and even employees, he said. “You’ll have more opportunities to grow with the company.”
River City has 1,036 employees.
Pinnacle shareholders will receive $20 in cash and .42 shares of Penn common stock for each Pinnacle share, reflecting a 36 percent premium, according to a Pinnacle press release sent at 7 a.m. Monday to coincide with press releases from Penn and Boyd.
“By combining our highly complementary portfolios and similar operating philosophies, we will be able to leverage the strengths of both our companies and create an unparalleled experience for our regional gaming customers, while generating significant value for our shareholders and business partners,” stated Timothy Wilmott, Penn’s chief executive officer.
Besides Argosy, Hollywood and River City, the other three casinos in the St. Louis region are Casino Queen in East St. Louis, which is employee-owned; Lumiere Place in downtown St. Louis, owned by Atlantic City-based Tropicana Entertainment; and Ameristar.
Casino Queen managers declined to comment on the acquisition.
Steve Klotz, director of marketing for Ameristar and River City, referred calls for comment to Roxann Kincade, director of Pinnacle public relations, who referred calls to Stremming.
Penn owns the Tropicana casino resort in Las Vegas, which is different than the gaming company based in Atlantic City; and M Resort in Henderson, Nevada, a Las Vegas suburb. Boyd owns the Las Vegas properties Aliante, The Orleans, Gold Coast, Suncoast, Sam’s Town, Eastside Cannery, Cannery, California, Fremont, Main Street, Jokers Wild and Eldorado, according to its website.
Bourie doesn’t see any obvious downside to the St. Louis changes that are planned.
“If you have too many casinos owned by one company controlling the marketplace, that would be bad, but it doesn’t sound like that is happening here,” he said. “Competition is always good for the players.”