Through its acquisition of PSG, Penn National will gain 1,100 terminals across Illinois.
Penn nationwide Gaming, Inc. will acquire Prairie State Gaming (PSG), an Illinois operator of video gaming terminals (VGTs), for an undisclosed charge. The company adds the acquisition to its collection of some 31,000 video gaming devices in 26 facilities across America.
While Illinois lawmakers squabble about their budget plans, with the resulting standoff meaning that big tax profits from the state’s VGTs will be held in limbo until they can agree terms, Penn National is looking to get its very own slice of this industry that is lucrative.
The deal, for an undisclosed transaction that is all-cash will discover the Pennsylvania-based casino, racetrack, and racino operator acquire 1,100 terminals across a network of 270 different pubs and retail chelsea football club player gaming establishments statewide.
In Illinois, anywhere having a liquor permit is permitted to use a VGT, and it is big business. But that reality has created something of a challenge to the state’s casino industry.
The VGT industry raked in $72.8 million in revenue in July, compared to the combined $118.1 million in revenue of Illinois’ ten casinos, in accordance with Fantini Gaming Research. For Penn National, which owns three of those casinos, it’s a thought process of ‘if you can’t beat ’em, join ’em.’
PSG, which is amongst the VGT operators that are largest in Illinois, created nearly $10 million in cashflow for the financial 12 months ending June 30th.
According to Jay Snowden, chief operating officer of Penn National, the acquisition represents the phase that is latest in a long-term strategy for ‘growth through accretive acquisitions.’
In the company agreed to purchase the Tropicana in Las Vegas for $360 million, making it the operator’s second Sin City property april. The organization first bought off the debt for and in of 2011 finalized its purchase of the M Resort and Casino on the South Las Vegas Strip june.
Penn nationwide currently runs 26 casino, racinos, and racetracks in 16 US and one Canadian jurisdiction, with the majority found in the Midwest and also the South of the United States.
Placed for development
The offer will further cement the company’s position in Illinois, said Snowden. ‘We believe this acquisition will provide us a solid platform for future growth in the Illinois VGT market and potentially other states where this form of gaming is authorized.
‘PSG is certainly one of Illinois’ most respected VGT operators, by having a strong track record of regulatory compliance and a reputation for dependable 24 / 7 solution backed by among the industry’s many experienced groups,’ he added.
Penn National’s recent performance that is financial made the investment community sit up and simply take notice. Its Q2 results for 2015 have exceeded objectives, bringing in revenues of $701 million, and the company says it remains favorably positioned for continued development into the 2nd half of this year.
Along with the purchase of this Tropicana, Penn State opened Massachusetts’ first casino during the end of June. Called Plainridge Park Casino, the slots-only establishment tacked onto the racecourse, and reported $6.1 million in gambling revenue in its first week of operation.
Optimal Payments’ Skrill Takeover to Complete by August 10
Optimal Payments acquisition of Skrill has gotten the go-ahead from UK financial regulators, as the payments industry looks to consolidate in the face of increased competition that is mobile . (Image: totallygaming.com)
NETELLER moms and dad Optimal Payments has announced that its €1.1 billion ($1.2 billion) reverse takeover of Skrill, formerly Moneybookers, will be finalized next Monday, August 10, after having the light that is green UK financial regulators.
Optimal received approval to acquire Skrill’s US company from American regulators in June. Both companies provide their payment services towards the US that is new online areas.
The deal highlights a time period of consolidation into the electronic re payments industry, as competition increases and innovation that is mobile disruption make the pooling of resources attractive. A month after the Optimal deal was announced in April, Skrill completed the acquisition of UK competitor Ukash.
The launch of Apple’s ‘wave and pay’ system on iPhone has spooked the digital wallets industry, which views the incursion of large non-traditional payment service provides into the re payment space being a threat that is highly disruptive. The ‘wave and pay’ system allows users to load credit card details onto their device, acting as a de facto e-wallet.
‘ Not Just a Defensive Move’
Optimal Payments has denied that the acquisition is a defensive move, citing growth that is steady. Instead, analysts have said the enlarged business, which marries two of the UK’s biggest electronic payment services, will benefit from greater scale. It’s estimated the group that is combined have a cash flow of around £117 million ($182 million); Optimal’s standalone figure is around £58 million ($90 million).
The deal will relieve both organizations’ reliance on the gambling that is online, consolidating their more mainstream ecommerce interests.
‘we are becoming more appropriate in the e-commerce space and we come across organic growth both here and in gaming following the deal,’ Joel Leonoff, chief executive of Optimal, insisted recently.
Optimal also would like to minimize its present dependence on an unnamed Asian customer, which reportedly now represents over 33 % of this business’s product sales.
Online Gaming Payments Giant
‘Over the past four years, we have effectively delivered significant growth in profits and earnings for the shareholders,’ said Leonoff. ‘This development resulted from performing our strategy to generate high degrees of organic growth and also to supplement this with accretive acquisitions.
‘The acquisition of Skrill will create a tech that is global within the fast growing digital payments space and now we think represents a transformational step forward that greatly accelerates our strategic plan. The Optimal Payments management group is extremely worked up about the prospects that are future the business.’
NETELLER ended up being formed back in 1999, at the time that is same PayPal. But while PayPal shied away from the grey legal area of on the web gambling in America, NETELLER embraced it.
By 2005, the company was processing 80 percent of online gambling transactions globally, which accounted for 95 percent of its revenue flow, but was forced to pull out of this market that is US after UIGEA made the processing of online gambling deals illegal.
Gaming Industry Wishes to See Regulation of Everyday Fantasy Sports
Yahoo has joined a growing number of major businesses wanting to break in to the fantasy that is daily industry. (Image: Eric Risberg/AP)
FanDuel and DraftKings have turned fantasy that is daily from the little niche item to the quickest growing section associated with fantasy sports industry.
Now, aided by the valuations of each of the organizations reaching $1 billion or more, the gaming industry is just starting to get sucked in, with some believing that the daily fantasy games deserve the same types of strict regulation casino companies deal with on a daily basis.
In accordance with officials at many major gaming firms, there’s nothing really incorrect with day-to-day fantasy sports (DFS), and they do not wish to see the offerings banned or restricted through the marketplace.
However, they think that regulation is a part that is important of sort of gambling product, something they feel applies to DFS sites just up to it does a casino or racetrack.
‘I think daily fantasy sports betting should be appropriate, just like I do believe traditional sports betting should really be legal,’ William Hill US CEO Joe Asher told Reuters. ‘But let us not pretend one is OK and also the other is maybe not. Drawing some line that is artificial the two makes no feeling as a matter of law or policy.’
DFS Embraced by Leagues, Media Titans
All major DFS sites suggest that their activities are totally legal, and both DraftKings and FanDuel stay out of five states where they feel laws do not allow fantasy sports games to offer money that is real.
That argument seems to have plenty of sway, as sports leagues and media businesses are both getting on board en masse: most leagues now have partnerships with one or more internet sites, ESPN has a major advertising and content deal with DraftKings, and both Yahoo and CBS have launched their very own DFS services and products in recent weeks.
But you can find those that are having a better look at the industry that is growing.
In Nevada, the state gaming control board is analyzing the legality of DFS games, though the industry thinks it really is quite clear that the contests are legal under a fantasy sports exemption within the 2006 Unlawful Internet Gambling Enforcement Act.
‘When you start offering day-to-day dream contests, then you start to blur the line between skill and chance,’ said Nevada Gaming Control Board Chairman AG Burnett. ‘ When chance starts to govern the outcome more than skill, there is a kind of gaming, and that’s as soon as the need for regulation kicks in.’
Lobbyists for the fantasy sports industry dispute that characterization, however, saying that their games are clearly more about skill than luck.
‘ They’re in contrast to games of possibility, where regardless of how skillful the players is, winning or losing always precipitates to fortune,’ said Jeremy Kudon, somebody at Orrick who lobbies for the Fantasy Sports Trade Association.
For their part, FanDuel and DraftKings issued a joint declaration for the Reuters report.
For the reason that statement, they stated they work working with officials in the video gaming industry ‘to educate them in the fantasy sports industry as our items are fundamentally separate from, and never competitive with, casinos and video gaming businesses.’
Legal Actions Target Free Money Marketing Campaigns
But you can find other threats to your industry as well.
DraftKings is facing class action lawsuits in at least three states, including Massachusetts, Florida, and Illinois, from players who feel they were deceived by the business’s aggressive advertising campaign, particularly due to misunderstandings over the nature of just how deposit bonuses work.
And while the Fantasy Sports Trade Association thinks fantasy that is daily is legal plus don’t represent gambling, even they will have expressed issues throughout the marketing promotions employed by the two major web sites.
‘The money motivation ended up being never ever an element that is key of sports,’ stated FSTA President Paul Charchian. ‘ Now a lot of the advertising in daily fantasy sports is truly extremely focused on monetary gain.’