Penn Nationwide Scoops Up Illinois Video Gaming Operator, Posts Strong Q2 Financials

Through its acquisition of PSG, Penn National will gain 1,100 terminals across Illinois.
Penn National Gaming, Inc. will acquire Prairie State Gaming (PSG), an Illinois operator of movie gaming terminals (VGTs), for an undisclosed fee. The company adds the acquisition to its collection of some 31,000 gaming machines 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 concur terms, Penn National is seeking to get its very own slice of this industry that is lucrative.
The deal, for an undisclosed all-cash deal, will dsicover the Pennsylvania-based casino, racetrack, and racino operator acquire 1,100 terminals across a network of 270 different pubs and retail gaming establishments statewide.
Big Business
In Illinois, anywhere with a alcohol permit is allowed to operate a VGT, and it is big business. But that reality has created something of the 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, based on Fantini Gaming Research. For Penn National, which has three of those casinos, it’s a thought process of ‘if you can’t beat ‘em, join ‘em.’
PSG, which is one of the VGT operators that are largest in Illinois, created almost $10 million in cashflow for the fiscal year 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 April, the company consented to purchase the Tropicana in Las Vegas for $360 million, making it the operator’s second Sin City property. The business 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 National currently runs 26 casino, racinos, and racetracks in 16 American and one Canadian jurisdiction, with almost all located in the Midwest plus the South of the United States.
Placed for development
The offer will cement the company further’s position in Illinois, said Snowden. ‘We believe this acquisition will provide us a platform that is solid future development in the Illinois VGT market and possibly other states where this form of gaming is authorized.
‘PSG is certainly one of Illinois’ most VGT that is respected, by having a strong track record of regulatory compliance and a reputation for reliable night and day solution supported by one of many industry’s many experienced teams,’ he added.
Penn nationwide’s recent performance that is financial made the investment community sit up and just take notice. Its Q2 results for 2015 have exceeded expectations, bringing in revenues of $701 million, and the company says it remains favorably positioned for continued growth into the second half with this year.
Along with the purchase for the Tropicana, Penn State opened Massachusetts’ first casino at the end of June. Called Plainridge Park real-money-casino.club 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 British financial regulators, as the payments industry looks to consolidate within 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 obtaining the green light from UK monetary regulators.
Optimal received approval to acquire Skrill’s US company from American regulators in June. Both companies offer their payment services to the US that is new online markets.
The deal highlights a 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 payment area as a extremely disruptive hazard. The ‘wave and pay’ system allows users to load credit card details onto their device, acting as a de facto e-wallet.
‘ Not 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 alleviate both businesses’ reliance on the gambling that is online, consolidating their more conventional e-commerce interests.
‘we are becoming more appropriate in the e-commerce area and we come across organic growth both here and in gaming after the deal,’ Joel Leonoff, leader of Optimal, insisted recently.
Optimal also wants to minimize its present reliance upon an unnamed customer that is asian which reportedly now represents over 33 percent regarding the company’s sales.
Online Gaming Payments Giant
‘Over the last four years, we have successfully delivered significant growth in revenues and earnings for our investors,’ said Leonoff. ‘This development lead from executing our strategy to generate high levels of organic growth also to supplement this with accretive purchases.
‘The acquisition of Skrill will create a global tech champion within the fast growing digital payments space and we think represents a transformational step forward that greatly accelerates our strategic plan. The Optimal Payments management group is extremely worked up about the future prospects for the Company.’
NETELLER ended up being formed back 1999, at the same time as PayPal. But while PayPal shied far from the grey legal area of on line gambling in America, NETELLER embraced it.
By 2005, the company was processing 80 per cent of on line gambling transactions globally, which accounted for 95 percent of its revenue flow, but was forced to pull out of the US market completely after UIGEA made the processing of online gambling transactions unlawful.
Gaming Industry Desires to See Regulation of Day-to-day Fantasy Sports
Yahoo has joined an increasing number of major businesses attempting to break in to the daily dream recreations industry. (Image: Eric Risberg/AP)
FanDuel and DraftKings have actually turned daily fantasy activities from the little niche product towards the fastest growing section regarding the fantasy recreations industry.
Now, with all the valuations of each of the organizations reaching $1 billion or more, the gaming industry is starting to take notice, with some believing that the daily fantasy games deserve the same types of strict regulation casino businesses deal with on a basis that is regular.
Based on officials at many gaming that is major, there’s nothing really incorrect with daily fantasy sports (DFS), and they don’t want to see the offerings banned or restricted through the marketplace.
However, they think that regulation is an important part of any 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 legal, simply like I believe traditional sports betting should really be legal,’ William Hill US CEO Joe Asher told Reuters. ‘But let’s not pretend one is OK therefore the other is maybe not. Drawing some line that is artificial the two makes no feeling being a matter of law or policy.’
DFS Embraced by Leagues, Media Titans
All major DFS sites suggest that their tasks are entirely legal, and both DraftKings and FanDuel stay out of five states where they feel laws do not allow fantasy sports games to provide real cash rewards.
That argument seems to have lots of sway, as sports leagues and media businesses are both getting on board en masse: most leagues now have partnerships with one or more sites, ESPN has an advertising that is major content deal with DraftKings, and both Yahoo and CBS have launched their very own DFS products in recent days.
But you can find those that are taking a better glance at the industry that is growing.
In Nevada, the state gaming control board is analyzing the legality of DFS games, although the industry believes it’s quite clear that the contests are legal under a fantasy sports exemption into the 2006 Internet Gambling Enforcement that is unlawful Act.
‘When you begin offering fantasy that is daily, then you begin to blur the line between skill and chance,’ said Nevada Gaming Control Board Chairman AG Burnett. ‘ When possibility begins to govern the outcome more than skill, you’ve got a kind of video gaming, and that’s whenever need for regulation kicks in.’
Lobbyists for the fantasy recreations industry dispute that characterization, however, saying that their games are clearly more about skill than luck.
‘ They’re nothing like games of possibility, where regardless of how skillful the players is, winning or losing always comes down to luck,’ stated 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.
In that declaration, they said on the dream sports industry as our products are fundamentally separate from, rather than competitive with, casinos and gaming businesses. they work using officials within the gaming industry ‘to educate them’
Legal Actions Target Free Money Marketing Campaigns
But you will find other threats towards the industry too.
DraftKings is facing class action lawsuits in at least three states, including Massachusetts, Florida, and Illinois, from players whom feel they were deceived by the company’s aggressive advertising campaign, particularly due to misunderstandings over the nature of exactly how deposit bonuses work.
And while the Fantasy Sports Trade Association thinks fantasy that is daily is legal and do not represent gambling, even they will have expressed concerns over the marketing promotions used by the 2 major web sites.
‘The money motivation was never ever a important element of dream sports,’ stated FSTA President Paul Charchian. ‘ Now a complete lot of the advertising in daily fantasy sports is actually excessively concentrated on financial gain.’
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