St. Louis Casinos To Be Sold In $2.8 Billion Merger

ST. LOUIS, MO — Penn National Gaming and Pinnacle Entertainment, two massive casino operators, have announced a $2.8 billion merger that includes Ameristar St. Charles, the St. Louis-area's largest casino. Under the terms of the deal, Pinnacle shareholders will receive $20 cash and 0.42 shares of Penn National stock for each Pinnacle share the own. The acquisition will give the company greater geographical diversity, according to a press release, and integration will free up cash flows.

“By combining our highly complementary portfolios and similar operating philosophies, we will be able to leverage the strengths of both our companies and create an unparalleled experience for our regional gaming
customers, while generating significant value for our shareholders and business partners," said Penn National CEO Timothy J. Wilmott.

But, the sale is expected to come under scrutiny from the Missouri Gaming Commission, Illinois Gaming Board, and possibly federal anti-trust regulators as well. In a possible attempt to appease those regulators, Penn National will divest from four properties, Ameristar Kansas City and Ameristar St. Charles in Missouri, plus Belterra Casino Resort in Indiana, and Belterra Park in Ohio, selling them to rival Boyd Gaming for approximately $575 million.

In addition to regulatory approval, the merger also needs to be approved by both companies' shareholders. They say they expect the deal to close by the second half of 2018. Upon completion of the deal, Penn National shareholders will hold 78 percent of the company's outstanding shares and Pinnacle shareholders will hold 22 percent, and Penn will control half of the casinos in the area, including Hollywood Casino in Maryland Heights, River City Casino in Lemay (a former Pinnacle property), and Argosy Casino in Alton, Ill.

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