Summary: Louisville-based Churchill Downs Incorporated has announced they soon will be officially part of the casino market in Pennsylvania.
In a press release on Monday, Churchill Downs Incorporated announced they are moving into the gaming market of Pennsylvania. Based in Kentucky, the company will be taking on the management of the Lady Luck Casino Nemacolin as well as purchasing the Presque Isle Downs & Casino.
Closing the Eldorado Resorts Deal
The announcement by Churchill Downs this week brings and end to the discussions with Eldorado Resorts. Earlier in the year, Churchill Downs had agreed to purchase the Lady Luck Vicksburg and Presque Isle Downs gaming venues of Mississippi, with a goal to enter the sports betting industry. This acquisition did not come to pass. However, Eldorado Resorts proposed a new deal that would give the brand managing rights of another Lady Luck venue, the one in Pennsylvania.
In July, it was announced that Churchill Downs would be managing the Nemacolin property, but they would have to acquire the property and the waiting period terminated before the Presque Isle Pennsylvania deal could go through. Early termination was awarded by the Federal Trade Commission on the 3rd of August, with the transaction requiring the approval of the regulators in Pennsylvania.
The transactions involving both gaming venues should close by the fourth quarter of this year. The two deals must see the receipt of gaming licensing from the Gaming Control Board and the Churchill Downs group will need to obtain a racing license from the State Horse Racing Commission. Once the deal is closed, the company will have casino properties in seven states in the eastern region of the US. The Eldorado Resorts company will still be the owner of the Lady Luck venue, but the operations will be leased to Churchill Downs Incorporated.
Online Gaming and Sports Betting under Consideration
When Churchill Downs Incorporated began discussions with Eldorado Resorts, the goal was to enter Mississippi to hopefully offer online gaming. When this deal fell through, the company did not give up their goal of going online. Back in February, Churchill Downs revealed that Presque Isle will give the company a foothold in Pennsylvania that will help the brand to begin offering real money online gaming. The state is already moving forward with the process of licensing land-based venues to enter the new industry.
Along with online gaming, Churchill Downs is also considering sports betting. After the United States Supreme Court decided to rule that the PASPA was no longer valid, Churchill Downs got busy, so they could enter the new industry as it developed in the US. To operate in Pennsylvania, the brand will need to pay up to $10 million for a sports betting license and be prepared to pay 36% in taxed revenues.
Soon after the SCOTUS ruling, the company signed a partnership agreement with SBTech to create an online gaming platform that would provide a consumer website, back office systems and mobile applications for online gaming and sports betting. The company is relying on the deep expertise of SBTech to help Churchill Downs enter a new sector of the online gaming industry.
On top of that, the brand is also planning on entering the online gaming market of New Jersey with the help of the Golden Nugget. Churchill Downs will be using the casino license of the Golden Nugget to go online. The brand could not have a better partner as the Golden Nugget is the number one operator in the state of New Jersey when it comes to online gaming.