Penn National Gaming (PNG) announced Tuesday its plans to acquire the operations of Hollywood Casino Perryville in Maryland for $31.1 million. Currently, Gaming and Leisure Properties Inc (GLPI) operates the casino.
The strategic move by Wyomissing-based company comes merely six weeks after Maryland legalized its sports betting industry during the November election. Under the agreement, Penn National will lease the casino property from GLPI for about $7.77 million per year. The lease will have an initial term of 15 years, which could be extended by another 20 years in four 5-year extensions.
In a press release, President and CEO of PNG, Jay Snowden, said they are thrilled to acquire the operations of Hollywood Casino Perryville and added that the property they developed in 2010 would enable them to reenter the formidable Maryland gaming market. Snowden said the Free State would be the twentieth gaming jurisdiction to its nationwide footprint.
Maryland passed sports betting legislation last month during November 3 election, and the formal launch is expected to coincide with the kick-off of the 2021 football season, with the Barstool sportsbook as the most likely betting platform.
November Referendum Allows Sports Betting in Maryland
Voters in the Free State approved a referendum allowing sports betting last month, joining adjacent states Pennsylvania, Delaware, West Virginia, and the District of Columbia. However, the General Assembly must devise a structure for sports wagering in Maryland before any bets can be placed. This includes issuing gaming licenses and deciding what types of businesses can apply, how and where bettors can wager, and how the state would generate tax revenue from the industry.
According to official analysis, the state is expected to generate as much as $18.2 million annually by accepting bets, either online or in-person, if sports gambling revenue is taxed at 20%. The Maryland Lottery and Gaming Control Commission still has to approve the deal, which is expected to be completed mid-2021.
Details of the PNG Deal
Penn National built the Hollywood Casino Perryville in 2010, the first casino property in Maryland, before Gaming and Leisure, a real estate investment trust, acquired it in 2013 when Penn split its casino property from its real estate. Now, the initial developer is back after the acquisition.
The deal would also enable Penn to expand its Omni-gaming platform that enables customers to use the same account wherever they game, including the Barstool mobile app and retail sportsbook. In addition to the online social casino and retail sportsbook, Penn Interactive also operates bingo and iCasino products.
Penn National & Barstool Partnership
Penn National has already revealed it will add Barstool Sportsbook as its sportsbook operator once the state launches the betting operations after setting out all the regulations. Currently, Barstool’s landing in the state is the talk of the town. Maryland is only awarding nine sports betting licenses across the state.
In February 2020, Penn bought a stake in Barstool, paving the way for the company to enter the sports betting market. Under this partnership, the Milton-based digital media company promotes Penn National’s online and land-based casinos and sports betting products, including the Barstool sports betting app.
2021 Could Be a “Big Year” for Maryland Sports Betting
A gaming analyst James Karmel said 2021 could be a really big year for gaming if the COVID-19 vaccine works, and if sports betting launches in next year in Maryland, preferably to include mobile gaming.
However, it is yet to see how the General Assembly chalks out the final questions, such as which businesses will provide sports betting. Currently, there’s a presumption, Karmel said, that every casino will have a sports betting operation, “but we don’t know for sure”. The Free State could allow sports wagering to horse racing tracks.