LAS VEGAS
Penn National Gaming, Inc. entered into a definitive agreement to acquire Tropicana Las Vegas Casino Hotel Resort from its shareholders for $360 million, intending to fund the acquisition through an expansion of its existing credit facilities and cash on hand.
The resort is set on a 35-acre land parcel at the corner of Tropicana Boulevard and Las Vegas Boulevard, approximately 2.5 miles from McCarran International Airport on the southern end of the Las Vegas Strip, and features nearly 1,500 guest rooms including 181 suites. Amenities at the property include a 50,000-square-foot casino with over 1,000 gaming positions, a sports book, three full service restaurants, a food court, a 1,200-seat performance theater, the 300-seat Laugh Factory comedy club, over 100,000 square feet of exhibition and meeting space, a five-acre tropical beach event area and spa.
Over the past four years, Tropicana Las Vegas completed over $200 million of property upgrades including a complete renovation of all guest rooms, which feature a new South Beach theme. In addition, significant improvements were made to the ballroom, conference meeting space and Pavilion exhibition space, the 1,200 seat showcase performance theater, restaurant and entertainment areas, and the facility's infrastructure and mechanical systems.
Timothy Wilmott, CEO of Penn National Gaming, provided details on the planned improvements on the horizon for the iconic Las Vegas resort:
"Penn National has developed a two-phase plan to realize the full value of this transaction which we expect to occur over the next three to five years. In the first phase, we intend to invest approximately $20 million in facility improvements and integration activities. The integration activities will include the utilization of Penn National's nationwide database to drive increased visitation and yield, and the upgrade of existing technology infrastructure to integrate Tropicana's systems with Penn National's existing systems with the goal of launching Penn National's nationwide player loyalty program, Marquee Rewards, at Tropicana Las Vegas. In the second phase, we intend to evaluate other potential facility enhancements at the property, such as the addition of retail space, food and beverage outlets, casino floor improvements and potentially additional hotel rooms.”
The transaction and credit facility expansions are subject to regulatory approvals, the expiration of the applicable Hart-Scott-Rodino waiting period and other customary closing conditions and the transaction is expected to be finalized by year-end.
