Penn National Scoops Up Illinois Gambling Operator, Posts Strong Q2 Financials

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 movie gaming terminals (VGTs), for an undisclosed charge. The company adds the purchase to its collection of some 31,000 gaming devices in 26 facilities across America.
While Illinois lawmakers squabble about their budget plans, with the resulting standoff meaning that large tax profits from their state’s VGTs will be held in limbo until they can agree terms, Penn National is seeking to get its very own slice of the industry that is lucrative.
The deal, for an undisclosed all-cash transaction, will dsicover the Pennsylvania-based casino, racetrack, and racino operator acquire 1,100 terminals across a network of 270 different bars and retail gaming establishments statewide.
Big Business
In Illinois, anywhere with a liquor permit is allowed to use a VGT, and it’s really big business. But that reality has established one thing of the challenge to the state’s casino industry.
The VGT industry raked in $72.8 million in revenue in July, when compared with the combined $118.1 million in revenue of Illinois’ ten casinos, according to 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 probably the largest VGT operators in Illinois, created very nearly $10 million in cashflow for the financial year ending June 30th.
According to Jay Snowden, chief operating officer of Penn National, the acquisition represents the latest phase 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 financial obligation for and in of 2011 finalized its purchase of the M Resort and Casino on the South Las Vegas Strip june.
Penn nationwide currently operates 26 casino, racinos, and racetracks in 16 American and one jurisdiction that is canadian with almost all found in the Midwest while the South of the United States.
Positioned for development
The deal will further cement the company’s position in Illinois, said Snowden. ‘We believe this acquisition provides us a platform that is solid future growth in the Illinois VGT market and possibly other states where this form of video gaming is authorized.
‘PSG is one of Illinois’ most VGT that is respected, having a strong track record of regulatory compliance and a reputation for dependable 24 / 7 solution backed by one of the industry’s many experienced groups,’ he added.
Penn nationwide’s present economic performance has made the investment community sit up and simply 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 in the second half of this year.
June as well as the purchase of the Tropicana, Penn State opened Massachusetts’ first casino at the end of. 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 10 august
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 parent 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 getting the green light from UK economic regulators.
Optimal received approval to acquire Skrill’s US business from American regulators in June. Both companies provide their payment services to the new US online video gaming markets.
The deal highlights a time period of consolidation within the electronic re payments industry, as competition increases and innovation that is mobile disruption make the pooling of resources attractive. In April, Skrill completed the acquisition of UK competitor Ukash, a month after the Optimal deal was announced.
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 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 steady growth. Instead, analysts have said the enlarged company, which marries two of the UK’s biggest electronic payment services, will benefit from greater scale. It’s estimated the combined team will 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 online gambling industry, consolidating their more main-stream ecommerce interests.
‘we are becoming more relevant in the space that is e-commerce we see organic growth both there and in gaming following the deal,’ Joel Leonoff, leader of Optimal, insisted recently.
Optimal also really wants to minimize its present reliance upon an unnamed customer that is asian which reportedly now represents over 33 % regarding the company’s sales.
Online Gaming Payments Giant
‘Over the last four years, we have effectively delivered growth that is significant profits and earnings for our investors,’ said Leonoff. ‘This development resulted from performing our strategy to generate high degrees of organic growth also to supplement this with accretive purchases.
‘The purchase of Skrill will produce a global tech champion within the fast growing digital payments space and we think represents a transformational leap forward that greatly accelerates our strategic plan. The Optimal Payments management group is extremely worked up about the future prospects for the business.’
NETELLER ended up being formed back 1999, at the same time as PayPal. But while PayPal shied far from the grey legal area of online gambling in America, NETELLER embraced it.
By 2005, the business was processing 80 percent of online gambling transactions globally, which accounted for 95 percent of its revenue flow, but was forced to grab of this market that is US after UIGEA made the processing of online gambling deals unlawful.
Gaming Business Wishes to See Regulation https://real-money-casino.club/club-player-online-casino/ of Constant Fantasy Sports
Yahoo has joined an increasing number of major organizations trying to break to the fantasy that is daily industry. (Image: Eric Risberg/AP)
FanDuel and DraftKings have actually turned fantasy that is daily from the little niche item to the quickest growing portion regarding the fantasy recreations industry.
Now, utilizing the valuations of each of those companies reaching $1 billion or more, the video gaming industry is just starting to get sucked in, with some believing that the daily fantasy games deserve the exact same sorts of strict regulation casino organizations deal with on a basis that is regular.
Based on officials at many major gaming firms, there’s absolutely nothing actually incorrect with daily fantasy sports (DFS), and they do not wish to see the offerings banned or restricted through the marketplace.
However, they believe legislation 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 just be legal like I do believe old-fashioned sports betting must certanly be legal,’ William Hill US CEO Joe Asher told Reuters. ‘But let’s not pretend one is OK therefore the other is perhaps not. Drawing some line that is artificial the two makes no sense being a matter of law or policy.’
DFS Embraced by Leagues, Media Titans
All major DFS sites state that their activities are entirely legal, and both DraftKings and FanDuel stay out of five states where they feel laws do not allow fantasy sports games to offer real money prizes.
That argument seems to have plenty of sway, as sports leagues and media companies are both getting on board en masse: most leagues now have partnerships with more than one web sites, ESPN has an advertising that is major content deal with DraftKings, and both Yahoo and CBS have launched their own DFS items in recent months.
But there are those that are taking a closer glance at the growing industry.
In Nevada, the state gaming control board is analyzing the legality of DFS games, although the industry believes it really is quite clear that the contests are legal under a fantasy sports exemption within the 2006 illegal Internet Gambling Enforcement Act.
‘When you start offering fantasy that is daily, then you start to blur the line between skill and chance,’ said Nevada Gaming Control Board Chairman AG Burnett. ‘ When chance begins to govern the outcome more than skill, a form is had by you of video gaming, and that’s whenever need for regulation kicks in.’
Lobbyists for the fantasy activities industry dispute that characterization, nevertheless, saying that their games are clearly more about skill than luck.
‘ They’re not like games of chance, where no matter how skillful the players is, losing or winning always precipitates to luck,’ said Jeremy Kudon, someone at Orrick who lobbies for the Fantasy Sports Trade Association.
For their part, FanDuel and DraftKings issued a statement that is joint the Reuters report.
For the reason that declaration, they said on the fantasy sports industry as our products are fundamentally separate from, and not competitive with, casinos and gaming businesses. that they work working together with officials within the gaming industry ‘to educate them’
Legal Actions Target Free Money Marketing Campaigns
But you will find other threats to the industry also.
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 company’s aggressive advertising campaign, particularly due to misunderstandings over the nature of just how deposit bonuses work.
And while the Fantasy Sports Trade Association believes fantasy that is daily must certanly be legal and never constitute gambling, even they will have expressed concerns over the marketing campaigns used by the two major sites.
‘The money motivation was never a important element of fantasy sports,’ said FSTA President Paul Charchian. ‘ Now a complete lot of the marketing in daily fantasy sports is really excessively concentrated on financial gain.’
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