PNGI, Greenwood Compete for Casino License
Two Pennsylvania racetrack gaming companies are among the six bidders for a license to build a casino in Philadelphia.
It had been previously announced that Greenwood, which owns the Parx racetrack casino near Philadelphia, partnered with Cordish Cos., which owns the Maryland Live! casino south of Baltimore, Md., on a Philadelphia bid. On Nov. 15 Penn National Gaming Inc., which owns Hollywood Casino at Penn National Race Course near Harrisburg, Pa., submitted a bid for the project.
Pennsylvania gaming law prohibits either company from owning more than one-third of a second casino in the state. PNGI said it wants to partner with the City of Philadelphia "or one of its designated entities" and manage the casino for the group.
PNGI touted its balance sheet in a release. The Pennsylvania Gaming Control Board, which will issue the casino license, received five bids for the project.
"Given the rising number of recent proposed gaming projects that have not been completed for financial reasons, we believe Penn National's financial strength and proven ability to complete projects on schedule make us the ideal operator to develop this new gaming and entertainment facility in Philadelphia," PNGI chairman and chief executive officer Peter Carlino said. "We require no additional financing to move forward with our proposal and can fully fund the development and construction of Hollywood Casino Philadelphia with cash flow from existing operations."
Greenwood and PNGI propose to locate their casinos in the pro-sports stadium district of Philadelphia.
The two companies have long been partners in Pennwood Racing, which owns and operates Freehold Raceway and an off-track wagering facility in neighboring New Jersey. There has been friction, however; PNGI in 2010 sued Greenwood, alleging the company delayed opening an OTW in southern New Jersey to protect its Pennsylvania interests.
Parx and its off-track betting parlors are located just across the Delaware River from New Jersey. Greenwood also owns Atlantic City Race Course and an OTW facility in southern New Jersey.
Pennwood also operated Garden State Park, the New Jersey track that closed in May 2001 and was demolished to make way for a retail and residential complex. Garden State was a direct competitor with Parx, which then was called Philadelphia Park under Greenwood ownership.
PNGI, meanwhile, also said Nov. 15 it intends to pursue a plan to separate its gaming operating assets and real property assets into two publicly traded companies including an operating entity, Penn National Gaming, and, through a tax-free spin-off of its real estate assets to holders of common stock, a newly formed, publicly traded real estate investment trust subject to required gaming regulatory body approvals.
PNGI said it would be the only gaming company to pursue such a structure. Officials Nov. 16 said the separation would offer value for shareholders and opportunities for growth.
"This will allow us to move into markets we cannot get into today," Carlino said. "We're excited about what this can do."
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